July 30 Financial Breakfast: Gold prices await the Fed's decision at 3330, supported by optimistic trade talks, and oil prices rose by over 3%.
2025-07-30 07:20:34
On Wednesday (July 30, Beijing time), spot gold traded around $3,327.60 a barrel. Gold prices rose on Tuesday as investors awaited the results of trade negotiations and the Federal Reserve's policy meeting. U.S. crude oil traded around $69.22 a barrel. Oil prices rose more than 3% on Tuesday as U.S. President Trump put more pressure on Russia over the war in Ukraine and was optimistic that the trade war between the United States and its major trading partners was weakening.
The U.S. Treasury Department releases its quarterly refunding report statement, and the Bank of Canada announces its interest rate decision and monetary policy report.
U.S. stocks closed lower on Tuesday as some disappointing earnings reports pushed the S&P 500 and Nasdaq back from record highs, while investors awaited the Federal Reserve's policy announcement.
Several Dow Jones Industrial Average companies reported earnings, including UnitedHealth Group, Boeing and Merck, which all closed lower after announcing their quarterly results.
UnitedHealth Group Inc's shares fell 7.5% after it released a disappointing profit forecast, becoming the biggest drag on the Dow Jones Industrial Average. Boeing Co's shares fell 4.4% despite reporting a narrower second-quarter loss.
Merck & Co fell 1.7% after the company reported quarterly results and said it would extend a suspension of exports of its HPV vaccine Gardasil to China until at least the end of 2025 due to continued weak demand.
“Corporate earnings have been mixed. Economic data has been mixed, but not enough to have an impact on Fed policy,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder. “Over the next two days, you’re going to see Microsoft, Meta, Apple, Amazon — these are big companies whose earnings and outlooks will move the market.”
Meta, Microsoft, Amazon and Apple are all set to report earnings this week, which could have a significant impact on market movements given their market weight.
The Dow Jones Industrial Average fell 0.46% to 44,632.99, the S&P 500 fell 0.30% to 6,370.86, and the Nasdaq dropped 0.38% to 21,098.29.
UPS Corp. reported earnings and again declined to issue annual revenue and margin forecasts, sending its shares tumbling 10.6%, deepening concerns that U.S. President Donald Trump's evolving trade policies are putting pressure on the company.
UPS led the Dow Jones Transportation Average down 2.3%, its biggest one-day percentage drop since May 21.
Procter & Gamble fell 0.3% after the consumer goods maker forecast annual results below expectations and said it would raise prices on some products to offset the impact of tariffs.
On the economic front, the U.S. consumer confidence index rose to 97.2 in July, exceeding expectations. U.S. job vacancies fell in June, suggesting a further slowdown in labor market activity. The U.S. government will release its employment report on Friday.
The Fed is widely expected to hold interest rates steady in its policy statement on Wednesday. Comments from Chair Jerome Powell will be closely watched for the timing of any potential rate cut.
Gold prices rose on Tuesday as investors awaited the outcomes of trade talks and the Federal Reserve's policy meeting. Spot gold rose 0.4% to $3,327.69 per ounce. Gold prices hit their lowest point since July 9 on Monday after the United States and the European Union reached a framework trade agreement, curbing safe-haven demand for the precious metal. U.S. gold futures settled up 0.4% at $3,324.
"Given the risks of uncertainty surrounding the negotiations, some investors still believe it might be appropriate to hold some safe-haven assets in case the situation deteriorates again," said Fawad Razaqzada, market analyst at City Index and FOREX.com.
On the U.S. interest rate front, the Federal Reserve's two-day policy meeting concludes on Wednesday, with markets widely expecting rates to remain unchanged. Investors will closely monitor the Fed's comments for any signals on the timing and pace of possible future rate cuts.
Spot silver rose 0.1% to $38.19 an ounce, palladium rose 0.9% to $1,257.41, and platinum climbed 0.7% to $1,399.70.
Oil prices rose more than 3% on Tuesday as U.S. President Trump increased pressure on Russia over the war in Ukraine and expressed optimism that the trade war between the United States and its major trading partners was easing. Brent crude futures closed up 3.53% at $72.51 a barrel, while U.S. crude futures rose 3.75% to $69.21. Both contracts set their highest closing prices since June 20.
On Tuesday, Trump said he would begin imposing tariffs and other measures against Russia "in 10 days" if Moscow did not make progress toward ending the war in Ukraine.
"We've stepped up, we've set a strict 10-day deadline, and there are signs that other countries will join us," said Phil Flynn, senior analyst at Price Futures Group.
Oil prices were also supported by a trade deal between the United States and the European Union, which, while imposing a 15% import tariff on most EU goods, averted a full-blown trade war between the two major allies that would have affected nearly a third of global trade and dimmed the outlook for fuel demand.
The dollar hit a one-month high against the euro on optimism about trade deals. The dollar hit a one-month high against the euro on Tuesday after the United States reached a series of trade agreements with its major trading partners, while markets also awaited interest rate decisions from the Federal Reserve and the Bank of Japan.
U.S. President Donald Trump on Sunday reached his largest trade deal to date with the European Union, lifting 15% import tariffs on most EU goods and including $600 billion in EU investments in the United States. The agreement surpasses the $550 billion deal signed last week with Japan, which included reciprocal 15% tariffs. U.S. and Chinese officials concluded two days of talks in Stockholm on Tuesday.
The euro fell 0.39% against the dollar to $1.154775, its lowest level since June 23. The euro fell 1.29% in the previous trading day, its biggest one-day drop since mid-May. The euro is on track to record its first monthly loss against the dollar this year.
"After a sharp decline in the first half of the year, the dollar has rebounded in July, and I think it's mostly short covering," said Marc Chandler, chief market strategist at Bannockburn GlobalForex in New York. "The question is whether this is a trend change or a long-overdue technical correction."
The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.30% to 98.91, its highest level since June 23. The index is set for its first monthly gain this year.
"The market is breathing a sigh of relief that tariffs, at least the plans announced with Japan and the European Union, and a potential 90-day extension with the Asian giant, help remove downside tail risk," Chandler said.
Several EU leaders have criticized the trade deal with the United States. German Chancellor Angela Merz said Germany would suffer significant losses from the agreed tariffs. France's prime minister on Monday called the agreement a "dark day" for Europe.
Markets expect the Federal Reserve to keep interest rates unchanged at the end of its two-day monetary policy meeting on Wednesday. The benchmark 10-year U.S. Treasury yield fell 8.6 basis points to 4.334%.
The Bank of Japan is also likely to hold off on raising interest rates on Thursday after Japan and the United States reached a trade agreement last week. USD/JPY fell 0.05% to 148.465. USD/CHF strengthened 0.28% to 0.806 francs.
Bessant: If negotiations are sincere, the tariff level on August 1 will be temporary
U.S. Treasury Secretary Scott Bessant told CNBC in an interview that the snap-back tariffs, which took effect on August 1, will remain in place for "a few days to a few weeks, as long as the countries are still moving forward and negotiating in good faith." Regarding the August 1 tariffs, Bessant said, "I don't think it's the end of the world." He also said that President Trump, in some cases, is more satisfied with the tariff revenue than with the deal itself.
Trump says 20% to 25% tariffs on India possible, but no final decision yet
U.S. President Donald Trump said India could be subject to tariffs of 20% to 25%, but stressed that the final rate remains undetermined as the two countries continue trade negotiations before an August 1 tariff deadline. "I think so," Trump said Tuesday when asked if tariffs on India could reach that level. "India has been a great friend, but India has tariffs that are substantially higher than almost every other country," Trump said on Air Force One as he returned to Washington after a five-day visit to Scotland. "It's not working."
China-US economic and trade talks held in Stockholm, Sweden
From July 28th to 29th local time, the Chinese and US trade negotiators, Vice Premier He Lifeng, held trade talks in Stockholm, Sweden, with their US counterparts, US Treasury Secretary Jeffrey Bessant and Trade Representative Greer. The two sides had candid, in-depth, and constructive exchanges on trade and economic issues of mutual concern, including Sino-US economic and trade relations and macroeconomic policies. They reviewed and affirmed the consensus reached at the Geneva trade talks and the implementation of the London Framework for Action. Based on the consensus reached during the talks, the two sides will continue to push for the scheduled 90-day extension of the suspended 24% US reciprocal tariffs and China's countermeasures. He Lifeng stated that the Chinese and US trade teams should be guided by the important consensus reached in the June 5th call between the two presidents, uphold the principles of mutual respect, peaceful coexistence, and win-win cooperation, respect each other's concerns, further consolidate consensus, and deepen mutual trust. China's position on Sino-US trade relations is consistent. The essence of Sino-US trade relations is mutual benefit and win-win results. The two sides share broad common interests and vast space for cooperation in the trade and economic field. Cooperation between China and the US benefits both, while confrontation hurts both. A stable, healthy, and sustainable Sino-US economic and trade relationship is not only conducive to achieving their respective development goals, but also to promoting the development and stability of the world economy. Going forward, both sides should continue to implement the important consensus reached during the call between the two heads of state, give full play to the role of the Sino-US economic and trade consultation mechanism, continuously enhance consensus, reduce misunderstandings, strengthen cooperation, further deepen dialogue and consultation, and strive for more win-win results. The US side stated that a stable Sino-US economic and trade relationship is of great significance to both countries and the global economy, and is willing to work with China to continue to resolve differences in the economic and trade fields through the Sino-US economic and trade consultation mechanism, promote more consultation results, and further stabilize Sino-US economic and trade relations. (Xinhua News Agency)
Britain says it will recognize Palestine in September
On July 29th, local time, British Foreign Secretary Lamy announced that the UK would recognize the State of Palestine during the UN General Assembly in September while attending an international conference on the implementation of the "two-state solution" held at the UN headquarters. According to British media reports, more than 200 British MPs recently called on Prime Minister Starmer to immediately recognize the State of Palestine. In his statement on the situation in Gaza on the 25th, Starmer said that the UK hopes to promote the peace process and urgently calls for a ceasefire. "Recognition of the State of Palestine is one of the steps."
Did the US, UK, and Ukraine hold a secret meeting to replace Zelensky? Ukraine: Russia's divisive tactics
On July 29th, local time, the Main Intelligence Directorate of the Ukrainian Ministry of Defense issued a statement refuting the Russian Foreign Intelligence Service's claims that the UK, the US, and Ukraine held secret talks to replace Ukrainian President Zelenskyy. The statement claimed that such rumors were fabricated at the behest of Russian Foreign Intelligence Service Director Naryshkin, aimed at undermining Ukrainian social stability, alienating the unity of the Ukrainian military and political leadership, and diverting international attention from the Russia-Ukraine conflict.
The number of voters at the Fed's July meeting dropped to 11, with Kugler absent due to personal matters.
Federal Reserve Board Governor Adrienne Kugler will be absent from this week's policy meeting for personal reasons, reducing the number of voters on the interest rate decision to 11. While Governors Waller and Bowman may dissent in favor of a rate cut, the board still has a sufficient majority to maintain interest rates. There are no replacements for board seats, but the president's seat can be filled.
IMF raises global growth forecast, calls for reducing trade barriers
The International Monetary Fund (IMF) released an update to its World Economic Outlook on the 29th, slightly raising its forecast for global economic growth this year and next. The IMF noted that, due to factors such as U.S. trade policies, major global economies continue to face uncertainty, and the global economy remains relatively fragile. The report projects that the global economy will grow by 3% and 3.1% in 2025 and 2026, respectively, up 0.2 and 0.1 percentage points from its April forecasts. The IMF emphasized that the upward revision is due to factors such as importers stockpiling goods in advance due to the U.S. government's threat of tariff increases. Currently, global economic activity is distorted to some extent by the expectation of significant tariff increases. Economic policy uncertainty will continue to threaten global economic stability this year and next. (Xinhua News Agency)
Lutnick: There is still a lot of "bargaining" to be done with the EU, including digital service tax and steel and aluminum
U.S. Commerce Secretary Howard Lutnick said in an interview that he spoke with EU officials this morning about the U.S.-EU trade agreement. He stated that the digital services tax and "attacks on our tech companies" will be topics for discussion in future negotiations. He added that steel and aluminum, which were not included in the agreement, will also be negotiated. "There's still a lot of bargaining to be done," he added. He stated that the pharmaceutical and automotive industries are key to a trade agreement with the EU and that the U.S. will impose "substantial" tariffs if drugs are not produced in the United States. He stated that Trump will announce his pharmaceutical policy in the next two weeks.
The 2025 World Free Zones Organization Conference will be held in Haikou in mid-October
The Hainan International Economic Development Bureau announced on the 29th that the 2025 World Free Zones Organization Conference will be held in Haikou from October 10th to 12th, themed "Free Zones: Gateways to Prosperity, Trade, and Sustainable Innovation." The conference is co-hosted by the World Free Zones Organization and the Hainan International Economic Development Bureau. Both parties recently held a preparatory meeting for the conference. The 2025 World Free Zones Organization Conference will promote exchanges of insights, foster innovation, and establish partnerships among all parties involved in leveraging cutting-edge technologies in free zones to build innovative ecosystems, promote green and low-carbon development models, and deepen international cooperation and coordination mechanisms.
China's Finance Minister Lan Fuan: Research and promote the postponement of consumption tax collection on some items and its transfer to local governments, and optimize the VAT refund policy.
Minister of Finance Lan Fuan stated in an article published in the Study Times that the government will continue to deepen fiscal and taxation system reforms to better unleash the effectiveness of fiscal management. It will study and formulate opinions on improving the modern budget system, strengthen the systematic integration, coordination and efficiency of various budget management systems and measures, improve the fiscal transfer payment system and enhance local fiscal autonomy. It will study and promote the decentralization of consumption tax collection on some items to local governments, optimize the value-added tax refund policy, and study tax systems that are compatible with new business formats. It will strengthen scientific fiscal management and continuously improve its systematization, refinement, standardization, and legalization. It will deepen pilot programs for zero-based budgeting reform within central government departments and support local governments in deepening this reform.
Chinese Finance Minister Lan Fuan: Establish and implement a childcare subsidy system to enhance residents' spending power and willingness
Minister of Finance Lan Fuan stated in an article published in the Study Times that we must adhere to the principle of combining improving people's livelihoods with promoting consumption, strengthen pension and medical security, establish and implement a childcare subsidy system, and enhance residents' spending capacity and willingness. We must actively expand effective investment, focus on key areas and weak links, increase investment, improve investment efficiency, and better leverage the key role of investment in optimizing the supply structure. In the first half of the year, local government special bonds issued 2.16 trillion yuan, further expanding the scope of investment and the scope of project capital, providing strong support for the construction of major projects.
Focus on the day
The U.S. Treasury Department releases its quarterly refunding report statement, and the Bank of Canada announces its interest rate decision and monetary policy report.
stock market
U.S. stocks closed lower on Tuesday as some disappointing earnings reports pushed the S&P 500 and Nasdaq back from record highs, while investors awaited the Federal Reserve's policy announcement.
Several Dow Jones Industrial Average companies reported earnings, including UnitedHealth Group, Boeing and Merck, which all closed lower after announcing their quarterly results.
UnitedHealth Group Inc's shares fell 7.5% after it released a disappointing profit forecast, becoming the biggest drag on the Dow Jones Industrial Average. Boeing Co's shares fell 4.4% despite reporting a narrower second-quarter loss.
Merck & Co fell 1.7% after the company reported quarterly results and said it would extend a suspension of exports of its HPV vaccine Gardasil to China until at least the end of 2025 due to continued weak demand.
“Corporate earnings have been mixed. Economic data has been mixed, but not enough to have an impact on Fed policy,” said Tim Ghriskey, senior portfolio strategist at Ingalls & Snyder. “Over the next two days, you’re going to see Microsoft, Meta, Apple, Amazon — these are big companies whose earnings and outlooks will move the market.”
Meta, Microsoft, Amazon and Apple are all set to report earnings this week, which could have a significant impact on market movements given their market weight.
The Dow Jones Industrial Average fell 0.46% to 44,632.99, the S&P 500 fell 0.30% to 6,370.86, and the Nasdaq dropped 0.38% to 21,098.29.
UPS Corp. reported earnings and again declined to issue annual revenue and margin forecasts, sending its shares tumbling 10.6%, deepening concerns that U.S. President Donald Trump's evolving trade policies are putting pressure on the company.
UPS led the Dow Jones Transportation Average down 2.3%, its biggest one-day percentage drop since May 21.
Procter & Gamble fell 0.3% after the consumer goods maker forecast annual results below expectations and said it would raise prices on some products to offset the impact of tariffs.
On the economic front, the U.S. consumer confidence index rose to 97.2 in July, exceeding expectations. U.S. job vacancies fell in June, suggesting a further slowdown in labor market activity. The U.S. government will release its employment report on Friday.
The Fed is widely expected to hold interest rates steady in its policy statement on Wednesday. Comments from Chair Jerome Powell will be closely watched for the timing of any potential rate cut.
Gold Market
Gold prices rose on Tuesday as investors awaited the outcomes of trade talks and the Federal Reserve's policy meeting. Spot gold rose 0.4% to $3,327.69 per ounce. Gold prices hit their lowest point since July 9 on Monday after the United States and the European Union reached a framework trade agreement, curbing safe-haven demand for the precious metal. U.S. gold futures settled up 0.4% at $3,324.
"Given the risks of uncertainty surrounding the negotiations, some investors still believe it might be appropriate to hold some safe-haven assets in case the situation deteriorates again," said Fawad Razaqzada, market analyst at City Index and FOREX.com.
On the U.S. interest rate front, the Federal Reserve's two-day policy meeting concludes on Wednesday, with markets widely expecting rates to remain unchanged. Investors will closely monitor the Fed's comments for any signals on the timing and pace of possible future rate cuts.
Spot silver rose 0.1% to $38.19 an ounce, palladium rose 0.9% to $1,257.41, and platinum climbed 0.7% to $1,399.70.
Oil Market
Oil prices rose more than 3% on Tuesday as U.S. President Trump increased pressure on Russia over the war in Ukraine and expressed optimism that the trade war between the United States and its major trading partners was easing. Brent crude futures closed up 3.53% at $72.51 a barrel, while U.S. crude futures rose 3.75% to $69.21. Both contracts set their highest closing prices since June 20.
On Tuesday, Trump said he would begin imposing tariffs and other measures against Russia "in 10 days" if Moscow did not make progress toward ending the war in Ukraine.
"We've stepped up, we've set a strict 10-day deadline, and there are signs that other countries will join us," said Phil Flynn, senior analyst at Price Futures Group.
Oil prices were also supported by a trade deal between the United States and the European Union, which, while imposing a 15% import tariff on most EU goods, averted a full-blown trade war between the two major allies that would have affected nearly a third of global trade and dimmed the outlook for fuel demand.
Foreign exchange market
The dollar hit a one-month high against the euro on optimism about trade deals. The dollar hit a one-month high against the euro on Tuesday after the United States reached a series of trade agreements with its major trading partners, while markets also awaited interest rate decisions from the Federal Reserve and the Bank of Japan.
U.S. President Donald Trump on Sunday reached his largest trade deal to date with the European Union, lifting 15% import tariffs on most EU goods and including $600 billion in EU investments in the United States. The agreement surpasses the $550 billion deal signed last week with Japan, which included reciprocal 15% tariffs. U.S. and Chinese officials concluded two days of talks in Stockholm on Tuesday.
The euro fell 0.39% against the dollar to $1.154775, its lowest level since June 23. The euro fell 1.29% in the previous trading day, its biggest one-day drop since mid-May. The euro is on track to record its first monthly loss against the dollar this year.
"After a sharp decline in the first half of the year, the dollar has rebounded in July, and I think it's mostly short covering," said Marc Chandler, chief market strategist at Bannockburn GlobalForex in New York. "The question is whether this is a trend change or a long-overdue technical correction."
The dollar index, which measures the greenback against a basket of currencies including the yen and the euro, rose 0.30% to 98.91, its highest level since June 23. The index is set for its first monthly gain this year.
"The market is breathing a sigh of relief that tariffs, at least the plans announced with Japan and the European Union, and a potential 90-day extension with the Asian giant, help remove downside tail risk," Chandler said.
Several EU leaders have criticized the trade deal with the United States. German Chancellor Angela Merz said Germany would suffer significant losses from the agreed tariffs. France's prime minister on Monday called the agreement a "dark day" for Europe.
Markets expect the Federal Reserve to keep interest rates unchanged at the end of its two-day monetary policy meeting on Wednesday. The benchmark 10-year U.S. Treasury yield fell 8.6 basis points to 4.334%.
The Bank of Japan is also likely to hold off on raising interest rates on Thursday after Japan and the United States reached a trade agreement last week. USD/JPY fell 0.05% to 148.465. USD/CHF strengthened 0.28% to 0.806 francs.
International News
Bessant: If negotiations are sincere, the tariff level on August 1 will be temporary
U.S. Treasury Secretary Scott Bessant told CNBC in an interview that the snap-back tariffs, which took effect on August 1, will remain in place for "a few days to a few weeks, as long as the countries are still moving forward and negotiating in good faith." Regarding the August 1 tariffs, Bessant said, "I don't think it's the end of the world." He also said that President Trump, in some cases, is more satisfied with the tariff revenue than with the deal itself.
Trump says 20% to 25% tariffs on India possible, but no final decision yet
U.S. President Donald Trump said India could be subject to tariffs of 20% to 25%, but stressed that the final rate remains undetermined as the two countries continue trade negotiations before an August 1 tariff deadline. "I think so," Trump said Tuesday when asked if tariffs on India could reach that level. "India has been a great friend, but India has tariffs that are substantially higher than almost every other country," Trump said on Air Force One as he returned to Washington after a five-day visit to Scotland. "It's not working."
China-US economic and trade talks held in Stockholm, Sweden
From July 28th to 29th local time, the Chinese and US trade negotiators, Vice Premier He Lifeng, held trade talks in Stockholm, Sweden, with their US counterparts, US Treasury Secretary Jeffrey Bessant and Trade Representative Greer. The two sides had candid, in-depth, and constructive exchanges on trade and economic issues of mutual concern, including Sino-US economic and trade relations and macroeconomic policies. They reviewed and affirmed the consensus reached at the Geneva trade talks and the implementation of the London Framework for Action. Based on the consensus reached during the talks, the two sides will continue to push for the scheduled 90-day extension of the suspended 24% US reciprocal tariffs and China's countermeasures. He Lifeng stated that the Chinese and US trade teams should be guided by the important consensus reached in the June 5th call between the two presidents, uphold the principles of mutual respect, peaceful coexistence, and win-win cooperation, respect each other's concerns, further consolidate consensus, and deepen mutual trust. China's position on Sino-US trade relations is consistent. The essence of Sino-US trade relations is mutual benefit and win-win results. The two sides share broad common interests and vast space for cooperation in the trade and economic field. Cooperation between China and the US benefits both, while confrontation hurts both. A stable, healthy, and sustainable Sino-US economic and trade relationship is not only conducive to achieving their respective development goals, but also to promoting the development and stability of the world economy. Going forward, both sides should continue to implement the important consensus reached during the call between the two heads of state, give full play to the role of the Sino-US economic and trade consultation mechanism, continuously enhance consensus, reduce misunderstandings, strengthen cooperation, further deepen dialogue and consultation, and strive for more win-win results. The US side stated that a stable Sino-US economic and trade relationship is of great significance to both countries and the global economy, and is willing to work with China to continue to resolve differences in the economic and trade fields through the Sino-US economic and trade consultation mechanism, promote more consultation results, and further stabilize Sino-US economic and trade relations. (Xinhua News Agency)
Britain says it will recognize Palestine in September
On July 29th, local time, British Foreign Secretary Lamy announced that the UK would recognize the State of Palestine during the UN General Assembly in September while attending an international conference on the implementation of the "two-state solution" held at the UN headquarters. According to British media reports, more than 200 British MPs recently called on Prime Minister Starmer to immediately recognize the State of Palestine. In his statement on the situation in Gaza on the 25th, Starmer said that the UK hopes to promote the peace process and urgently calls for a ceasefire. "Recognition of the State of Palestine is one of the steps."
Did the US, UK, and Ukraine hold a secret meeting to replace Zelensky? Ukraine: Russia's divisive tactics
On July 29th, local time, the Main Intelligence Directorate of the Ukrainian Ministry of Defense issued a statement refuting the Russian Foreign Intelligence Service's claims that the UK, the US, and Ukraine held secret talks to replace Ukrainian President Zelenskyy. The statement claimed that such rumors were fabricated at the behest of Russian Foreign Intelligence Service Director Naryshkin, aimed at undermining Ukrainian social stability, alienating the unity of the Ukrainian military and political leadership, and diverting international attention from the Russia-Ukraine conflict.
The number of voters at the Fed's July meeting dropped to 11, with Kugler absent due to personal matters.
Federal Reserve Board Governor Adrienne Kugler will be absent from this week's policy meeting for personal reasons, reducing the number of voters on the interest rate decision to 11. While Governors Waller and Bowman may dissent in favor of a rate cut, the board still has a sufficient majority to maintain interest rates. There are no replacements for board seats, but the president's seat can be filled.
IMF raises global growth forecast, calls for reducing trade barriers
The International Monetary Fund (IMF) released an update to its World Economic Outlook on the 29th, slightly raising its forecast for global economic growth this year and next. The IMF noted that, due to factors such as U.S. trade policies, major global economies continue to face uncertainty, and the global economy remains relatively fragile. The report projects that the global economy will grow by 3% and 3.1% in 2025 and 2026, respectively, up 0.2 and 0.1 percentage points from its April forecasts. The IMF emphasized that the upward revision is due to factors such as importers stockpiling goods in advance due to the U.S. government's threat of tariff increases. Currently, global economic activity is distorted to some extent by the expectation of significant tariff increases. Economic policy uncertainty will continue to threaten global economic stability this year and next. (Xinhua News Agency)
Lutnick: There is still a lot of "bargaining" to be done with the EU, including digital service tax and steel and aluminum
U.S. Commerce Secretary Howard Lutnick said in an interview that he spoke with EU officials this morning about the U.S.-EU trade agreement. He stated that the digital services tax and "attacks on our tech companies" will be topics for discussion in future negotiations. He added that steel and aluminum, which were not included in the agreement, will also be negotiated. "There's still a lot of bargaining to be done," he added. He stated that the pharmaceutical and automotive industries are key to a trade agreement with the EU and that the U.S. will impose "substantial" tariffs if drugs are not produced in the United States. He stated that Trump will announce his pharmaceutical policy in the next two weeks.
Domestic News
The 2025 World Free Zones Organization Conference will be held in Haikou in mid-October
The Hainan International Economic Development Bureau announced on the 29th that the 2025 World Free Zones Organization Conference will be held in Haikou from October 10th to 12th, themed "Free Zones: Gateways to Prosperity, Trade, and Sustainable Innovation." The conference is co-hosted by the World Free Zones Organization and the Hainan International Economic Development Bureau. Both parties recently held a preparatory meeting for the conference. The 2025 World Free Zones Organization Conference will promote exchanges of insights, foster innovation, and establish partnerships among all parties involved in leveraging cutting-edge technologies in free zones to build innovative ecosystems, promote green and low-carbon development models, and deepen international cooperation and coordination mechanisms.
China's Finance Minister Lan Fuan: Research and promote the postponement of consumption tax collection on some items and its transfer to local governments, and optimize the VAT refund policy.
Minister of Finance Lan Fuan stated in an article published in the Study Times that the government will continue to deepen fiscal and taxation system reforms to better unleash the effectiveness of fiscal management. It will study and formulate opinions on improving the modern budget system, strengthen the systematic integration, coordination and efficiency of various budget management systems and measures, improve the fiscal transfer payment system and enhance local fiscal autonomy. It will study and promote the decentralization of consumption tax collection on some items to local governments, optimize the value-added tax refund policy, and study tax systems that are compatible with new business formats. It will strengthen scientific fiscal management and continuously improve its systematization, refinement, standardization, and legalization. It will deepen pilot programs for zero-based budgeting reform within central government departments and support local governments in deepening this reform.
Chinese Finance Minister Lan Fuan: Establish and implement a childcare subsidy system to enhance residents' spending power and willingness
Minister of Finance Lan Fuan stated in an article published in the Study Times that we must adhere to the principle of combining improving people's livelihoods with promoting consumption, strengthen pension and medical security, establish and implement a childcare subsidy system, and enhance residents' spending capacity and willingness. We must actively expand effective investment, focus on key areas and weak links, increase investment, improve investment efficiency, and better leverage the key role of investment in optimizing the supply structure. In the first half of the year, local government special bonds issued 2.16 trillion yuan, further expanding the scope of investment and the scope of project capital, providing strong support for the construction of major projects.
- Risk Warning and Disclaimer
- The market involves risk, and trading may not be suitable for all investors. This article is for reference only and does not constitute personal investment advice, nor does it take into account certain users’ specific investment objectives, financial situation, or other needs. Any investment decisions made based on this information are at your own risk.
