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China's major data is released! Trump gives ultimatum to Putin
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Hello everyone, today XM Foreign Exchange will bring you "[XM Foreign Exchange Decision Analysis]: China's heavy data is released! Trump issued an "ultimatum" to Putin. Hope it will be helpful to you! The original content is as follows:
On July 15, during the Asian market on Tuesday, spot gold trading around $3,344.46/ounce, gold prices fell after hitting a three-week high on Monday. The focus of market attention was on trade negotiations and U.S. economic data, while silver climbed to its highest level since September 2011; U.S. crude oil trading around $66.95/barrel, oil prices fell nearly 3% on Monday. Investors weighed the new threat of US President Trump to impose sanctions on Russian oil buyers, a move that could affect global oil supply, while investors are still worried about Trump's tariffs.
U.S. President Trump threatened on Saturday that he would impose a 30% tariff on goods imported from Mexico and the EU from August 1, after he had weeks of negotiations with the two major trading partners but failed to reach a www.xmhouses.comprehensive trade deal.
But since Trump first announced higher-than-expected trade tariffs in April and then postponed their implementation, the market's immunity to tariff news has become increasingly strong. "This is something that has happened before, and the impact has disappeared," said Joseph Trevisani, senior analyst at FXStreet. "At the same time, "negative forecasts have not become a reality, so I don't think tariffs will have too much impact on the market."
The EU accused the United States of being tough on pushing a trade deal, hindering consensus, and warned that countermeasures would be considered if a deal could not be reached to avoid severe tariffs.
Investors will focus on June’s consumer price inflation data on Tuesday to look for signs of price pressure accelerating again.
Economists surveyed by Reuters expect that overallThe annual inflation rate will rise to 2.7% from 2.4% last month. Core inflation is expected to rise from 2.8% to 3.0%.
Federal Funds Rate Futures Traders are expected to cut interest rates by 50 basis points by the end of the year, with the first rate cut expected in September.
Trump criticized Powell again on Monday, saying interest rates should be 1% or less. The dollar strengthened on Monday, partly because President Trump announced a new round of weapons aid to Ukraine and threatened to impose sanctions on countries that buy Russian exports unless Russia agrees to a peace agreement within 50 days.
Five ECB policymakers told Reuters that Trump's tariff threat www.xmhouses.complicated the ECB's decision-making but is unlikely to undermine plans to suspend interest rate cuts next week.
Asian market
China's economy grew by 5.2% year-on-year in the second quarter, slightly higher than expected 5.1%, but lower than 5.4% in the first quarter. Industry data shows that various industries have achieved balanced growth - primary output has increased by 3.7%, secondary output has increased by 5.3%, and tertiary industry has increased by 5.5%. The National Bureau of Statistics pointed out that macroeconomic policy supports stability, but it also indicates continued weakness in domestic demand and external resistance.
The June data painted a mixed picture. Industrial production accelerated from 5.8% year-on-year to 6.8%, surpassing the year-on-year expectation of 5.6%, indicating that export-oriented industries and manufacturing industries continue to strengthen. However, retail sales fell to 4.8% year-on-year, significantly lower than 6.4% in May and below 5.2% expected.
Fixed asset investment has slowed to 2.8% year-to-date, far lower than expected 3.7%. The decline in real estate investment further deepened, with a decline of -11.2% in the first half of the year and a contraction of -0.6%.
The Westpac Consumer Confidence Index in July rose slightly by 0.6% to 93.1, but the slight increase concealed the obvious disappointment of households.
Westpac noted that market sentiment was significantly strong ahead of the RBA's July meeting, with those surveyed before the decision reporting the index of 95.6. That fell to 92 after the RBA unexpectedly kept interest rates stable, indicating that the decision has shattered hopes of relief.
So, consumer confidence remains at what Westpac calls "cautious pessimism".
Looking forward, the market is paying attention to the next meeting that the RBA will hold from August 11 to 12. If inflation exceeds the second quarter, the central bank may pause interest rate hikes again, but it is more likely to confirm that inflation remains within the 2-3% target range. This will pave the way for a 25 basis point rate cut in August, and is expected to cut again in November.
European Market
Source said the ECB will discuss a more negative situation next week than expected in June, following Trump's latest threat to trade tax. ECB is still expected to keep interest rates unchanged at its July 24 meeting. Discussions on interest rate cuts have been delayed until September.
U.S. Market
In an interview with Fox Business Channel, Cleveland Fed Chairman Beth Hammack said that given the current strong momentum of the U.S. economy, she believes the urgency of a rate cut is not very important. Hammack said the Fed was “very close to neutral rates” and noted that she didn’t see www.xmhouses.compelling reasons for policy easing unless “substantial weakness in the labor force”.
While opening the door to the transformation based on incoming data, Hammack stressed that the Fed is performing its employment task but has not met the requirements in terms of inflation. “We have not reached our targets in terms of authorized inflation,” she said, adding that a restrictive stance should be maintained until significant progress is made.
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