02/02/2026

BIZ & FINANCE MONDAY | FEB 2, 2026

FOLLOW

ON INSTAGRAM

18

Malaysian Paper

@thesundaily @t

Trump picks Kevin Warsh to lead Federal Reserve

Maersk to take over operation of two ports on Panama Canal PANAMA CITY: Danish firm Maersk will temporarily take over operation of two ports on the Panama Canal from Hong Kong company CK Hutchison, whose concession has been annulled, the Panama Maritime Authority (AMP) said. Panama’s Supreme Court on Thursday invalidated Hutchison’s contract following repeated threats from President Donald Trump that the United States would seek to reclaim the waterway he said was effectively being controlled by China. The canal, which handles about 40% of US container traffic and 5% of world trade, was built by the United States, which operated it for a century before ceding control to Panama in 1999. CK Hutchison’s contract to operate the ports had “disproportionate bias” toward the Hong Kong-based company, according to the court ruling that annulled the deal. On Friday, the AMP said port operator APM Terminals, part of the Maersk Group, would be a “temporary administrator” of the Balboa and Cristobal ports on either end of the waterway. It would take over from the Panama Ports Company (PPC) – a subsidiary of CK Hutchison Holdings – which has managed the ports since 1997 under a concession renewed in 2021 for 25 years. The United States’ on Friday welcomed the decision, but Chinese Foreign Ministry spokesman Guo Jiakun said Beijing “will take all measures necessary to firmly protect the legitimate and lawful rights and interests of Chinese companies”. For its part, PPC said the ruling “lacks legal basis and endangers ...the welfare and stability of thousands of Panamanian families” who depend on its operations. The annulment of the PPC contract was requested last year by the office of the comptroller – an autonomous body that examines how government money is spent. It argued the concession was “unconstitutional” and said Hutchison had failed to pay the Panamanian state US$1.2 billion due. The PPC argues it is the only port operator in which the Panamanian state is a shareholder and says it has paid the government US$59 million over the past three years. “It is very hard to imagine that (the court ruling) was not influenced by persistent US pressure on canal ownership,” said Kelvin Lam, a China-focused economist at the consultancy Pantheon Macroeconomics. He said foreign investors would likely be increasingly cautious about committing capital “to strategic infrastructure projects in the United States’ backyard”. – AFP for 3D gaming – powered the company’s market cap to over US$5 trillion in October, although the figure has since fallen back by more than US$600 billion. LLM developers like OpenAI are directing much of the mammoth investment they have received into Nvidia’s products, rushing to build GPU-stuffed data centres to serve an anticipated flood of demand for AI services. – AFP

WASHINGTON: President Donald Trump said he would nominate former Federal Reserve governor Kevin Warsh to be the next US central bank chief, a move that has sparked cautious optimism among observers. The decision caps a highly publicised search for a successor to Fed chairman Jerome Powell, whom the president has repeatedly lambasted for not cutting interest rates more swiftly. Trump told reporters last week that Warsh “certainly wants to cut rates”, but added that he did not wish to question Warsh on commitments to do so. “I have known Kevin for a long period of time, and have no doubt that he will go down as one of the GREAT Fed Chairmen, maybe the best,” Trump wrote on Truth Social, announcing his choice. “On top of everything else, he is ‘central casting,’ and he will never let you down,” Trump added. Warsh, 55, was the youngest person to serve as a Fed governor, a role he held from 2006 to 2011. Trump considered Warsh for the top Fed job too during his first presidency, but eventually chose Powell – a decision he quickly soured on. Prices of precious metals – seen as safe haven investments – sank on Friday in a sign that investors were reassured by Trump’s choice. The dollar pushed higher. “I think markets are broadly happy at the moment,” Atlantic Council international economics chairman Josh Lipsky told AFP. “It is a pick that another Republican president may have made. “He cares about the history of the Fed, the process of the Fed, central bank independence, he’s talked about this before.” Powell’s chairmanship ends in May, and it remains unclear if he will also step down from the Fed’s board of governors, which would free up another vacancy Trump could fill. Warsh will need to be confirmed by the US Senate, where he will face tough questions from lawmakers amid growing concerns about threats to Fed independence. Trump’s attempt to oust Fed governor Lisa Cook, and his administration’s investigation into Powell over renovation costs at the bank, have sparked worries about the institution’s insulation from politics. An erosion of Fed independence could have negative ramifications for the economy, experts warn. Warsh must now get through a Senate o Prices of precious metals sink in sign that investors reassured by choice

Warsh speaking during a monetary policy conference at Stanford University’s Hoover Institution in Palo Alto, California. – REUTERSPIC

analysts are monitoring if Warsh defends the bank’s independence. He will need to convince markets and policymakers that he is upholding the Fed’s dual mandate of stable prices and low unemployment – despite political pressure. Already, the Fed’s job has become increasingly challenging as US tariffs fuel worries of stubborn inflation, while the employment market cools. Policymakers walk a tightrope in deciding if they should keep rates higher to curb inflation or lower them to support the economy. With the labour market likely deteriorating further and inflation expected to ease, the next Fed chief could uncontroversially reduce rates, Tombs said. But it remains to be seen if he will still push for cuts if inflation proves sticky in months ahead. Trump’s selection ends a race that narrowed to four contenders – Warsh; Fed governor Christopher Waller; Rick Rieder of BlackRock; and Trump’s top economic adviser Kevin Hassett. – AFP

Banking while “maintaining the confidence of both markets and the president”, said economist Samuel Tombs of Pantheon Macroeconomics. After that, he must pass a confirmation vote in the Senate with a simple majority. But Republican Thom Tillis of the banking committee reiterated on Friday his plan to oppose the confirmation of Fed nominees – including the next chairman – until the probe against Powell is resolved. The panel’s top Democrat, Senator Elizabeth Warren, warned that Warsh’s nomination “is the latest step in Trump’s attempt to seize control of the Fed”. With 13 Republicans and 11 Democrats on the committee, a single Republican’s opposition could trigger an impasse. Warsh was once seen as an inflation “hawk” favouring higher interest rates to curb price hikes. But he has stepped up criticism of the Fed recently, endorsing policy positions of the Trump administration. As Trump continues to call for lower rates, Committee hearing

Nvidia boss insists ‘huge’ investment in OpenAI on track TAIPEI: Nvidia chief executive Jensen Huang has insisted the US tech giant will make a “huge” investment in OpenAI and dismissed as “nonsense” reports that he is unhappy with the generative AI star. Huang made the remarks late on Saturday in Taipei after the Wall Street Journal reported that Nvidia’s plan to invest up to US$100 billion (RM394 billion) in OpenAI had been put on ice. Nvidia announced the plan in September to invest US$100 billion in OpenAI, building infrastructure for next-generation artificial intelligence. The Wall Street Journal , citing unnamed sources, said some people inside Nvidia had expressed doubts about the deal and that the two sides were rethinking the partnership. “That’s complete nonsense. We are going to make a huge investment in OpenAI,” Huang told journalists, when asked about reports that he was unhappy with OpenAI. Huang insisted that Nvidia was going ahead with its investment in OpenAI, describing it as “one of the most consequential companies of our time”. “Sam is closing the round, and we will absolutely be involved in the round,” Huang said, referring to

OpenAI chief executive Sam Altman. “We will invest a great deal of money, probably the largest investment we’ve ever made.” Nvidia has come to dominate spending on the processors needed for training and operating the large language models (LLM) behind chatbots like OpenAI’s ChatGPT or Google Gemini. Sales of its graphics processing units (GPUs) – originally developed