27/05/2025 Daily Reports
Dollar Under Pressure
• USD heads for a fifth consecutive monthly decline – its longest losing streak since 2017.
• Euro trades near $1.1379, while USD/JPY holds steady at 143.00.
• Market sentiment is fragile amid erratic U.S. trade policies and ballooning fiscal deficits.
Bond Markets React
• Global yields remain elevated due to fiscal concerns.
• Japan’s super-long bond yields retreat after last week’s sharp selloff.
• U.S. 10-year yield steady at 4.4773%.
Investor Focus This Week
• Nvidia earnings (Wed): AI bellwether expected to post a 66% revenue jump.
• U.S. Core PCE inflation (Fri): Key data point for Fed policy outlook.
• Multiple Fed speeches will likely guide expectations on rates.
Gold and Oil Movements
• Gold dips 0.3% but remains near record highs as investors seek USD alternatives.
• Brent crude: ▼ 0.22% at $64.60
• WTI crude: ▼ 0.33% at $61.33, as market eyes OPEC+ production decisions.
What’s Next?
• Growing concerns over U.S. fiscal sustainability and uncertain trade policies continue to undermine investor confidence. As the U.S. dollar’s safe-haven status is increasingly questioned, investors are turning to alternative assets like gold. In this environment, key economic data releases and statements from central bank officials during the week are likely to play a critical role in shaping market direction.
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Markets Rebound on Delayed Tariffs; China Auto Sector Struck by “Zero-Mileage” Crisis as EV Price War Intensifies
• US stock futures surged after President Trump delayed a comprehensive 50% tariff on EU products to July 9, leaving space for talks.
• The move, a turnaround from earlier threats, had the market recover from a week of losses driven by tariff uncertainty and debt concerns.
• Although US markets had a positive reaction, Asia-Pacific markets generally fell as investors absorbed the delayed tariffs.
• Trump also continued to attempt to urge smartphone makers like Apple and Samsung to relocate their production to the US. Traders currently anticipate a hectic week of economic announcements, Federal Reserve communications, and contentious tax bill, with Nvidia’s earnings being a priority.
• The rest of the world is in the meantime grappling with gigantic automobile problems. China’s commerce ministry will meet with automakers like BYD and Dongfeng Motor to talk about “zero-mileage secondhand cars,” a product of the fiercely competitive price war in the industry.
• This comes after Tesla’s sales in Europe fell 49% in April, as overall battery-electric vehicle sales increased in the region, indicating problems of brand image.
• BYD shares also crashed after offering deep discounts, sparking concerns of a new Chinese EV price war.
• On the larger market, gold persisted in its losses as the dollar gained and the demand for safe-haven assets decreased due to better economic hopes of US-EU trade relations.
