Group 1 - Developed markets experienced a decline, with the S&P 500 down 0.3% and the Dow Jones Industrial Average down 1.0% [2][4] - The 10-year U.S. Treasury yield rose by 8 basis points to 4.4%, while the dollar index increased by 0.9% to 97.87 [2][4] - Emerging markets showed mixed performance, with indices like the Ho Chi Minh Index and the Korea Composite Index rising by 5.1% and 4.0% respectively, while the Brazilian IBOVESPA and Indian SENSEX30 fell by 3.6% and 1.1% [4][9] Group 2 - The U.S. announced an increase in tariffs on 14 countries, effective August 1, with rates as high as 50% on copper products [2][65] - The June FOMC meeting minutes revealed a division among Federal Reserve officials regarding the impact of tariffs on inflation, with some believing it would have a temporary effect while others anticipated a more lasting impact [2][81] - Eurozone retail sales fell by 0.7% month-on-month in May, indicating a slowdown in consumer confidence [2][84] Group 3 - The U.S. fiscal deficit for 2025 reached $804.4 billion, up from $772.5 billion in the same period last year, with total expenditures at $4.4 trillion [69][70] - The demand for U.S. Treasury auctions remained robust, with a bid-to-cover ratio of 3.08 for 4-week bills and 2.61 for 10-year notes, indicating strong interest from investors [67][68] - Commodity prices generally increased, with WTI crude oil rising by 2.9% to $68.5 per barrel and COMEX gold up by 0.8% to $3,359.8 per ounce [48][54]

Group 1 - The article discusses the resurgence of the "Goldilocks" trade in overseas markets, driven by the successful implementation of the "Beautiful Act" and lower-than-expected inflation data, which has alleviated market concerns about economic slowdown and interest rate hikes [2][6] - The article highlights that the Israeli-Palestinian conflict has caused temporary market disturbances, but the overall market reaction to tariff adjustments has been relatively muted, with the S&P 500 experiencing only a slight decline [21][2] - The article notes that the domestic market is witnessing a mild economic recovery, with consumer policies effectively stimulating demand, as evidenced by a significant increase in retail sales growth in May [3][29] Group 2 - The article emphasizes that the focus for July will be on potential inflation risks in overseas markets and the "anti-involution" policies in the domestic market, with evidence suggesting that inflation in the U.S. may begin to rise due to various factors [55][62] - It mentions that the domestic economy is seeing a shift towards service sector recovery, with increased investment and consumption in services, while export pressures may be building [62][39] - The article outlines the government's focus on addressing "involution" through supply-demand adjustments and structural upgrades, indicating a broader scope for policy implementation [69][49]

Group 1: Macroeconomic Overview - Developed markets experienced a decline, with the S&P 500 down 0.3% and the Dow Jones Industrial Average down 1.0% [2][4] - The 10-year U.S. Treasury yield rose by 8 basis points to 4.4%, while the dollar index increased by 0.9% to 97.87 [2][4] - The expiration of tariff exemptions led to increased tariffs on 14 countries, effective August 1, including Japan and South Korea at 25% [2][4][66] Group 2: Sector Performance - In the U.S., most sectors within the S&P 500 saw declines, particularly financials (-1.9%), consumer staples (-1.8%), and communication services (-1.2%) [9] - Conversely, energy, utilities, and industrial sectors showed gains of 2.5%, 0.7%, and 0.6% respectively [9] - In the Eurozone, non-essential consumer goods, industrials, and energy sectors rose by 2.5%, 2.4%, and 2.3% respectively, while communication services and utilities fell [9] Group 3: Commodity Prices - Commodity prices generally increased, with WTI crude oil rising by 2.9% to $68.5 per barrel and Brent crude oil up by 3.0% to $70.4 per barrel [48] - COMEX gold increased by 0.8% to $3359.8 per ounce, while COMEX silver surged by 5.9% to $38.9 per ounce [48][54] - LME copper fell by 2.4% to $9640 per ton, while LME aluminum saw a slight increase of 0.1% [54] Group 4: Currency Movements - The dollar index rose by 0.9%, with most currencies depreciating against the dollar, including the Japanese yen (-2.0%) and the British pound (-1.1%) [31][42] - The offshore RMB depreciated to 7.1736 against the dollar, with the onshore rate at 7.1710 [42][31] Group 5: Fiscal and Monetary Policy - The U.S. fiscal deficit for 2025 reached $804.4 billion, up from $772.5 billion the previous year, with total expenditures at $4.4 trillion [69][70] - The June FOMC meeting minutes revealed a division among officials regarding the impact of tariffs on inflation, with some believing it would have a temporary effect while others anticipated a more lasting impact [81][82]

Core Viewpoint - The global economy is entering an uncertain phase characterized by multiple risks, including inflationary pressures and geopolitical tensions, particularly influenced by U.S. policies under the Trump administration [1][3][6]. Economic Outlook - The U.S. is expected to face "stagflation" in the second half of the year, with rising inflation and slowing growth. The Federal Reserve is anticipated to be cautious, delaying interest rate cuts until December, with cuts likely lower than market expectations [1][3][6]. - Core CPI in the U.S. is projected to rebound to 3.3% in Q4, influenced by rising import costs and tariffs [1][4][20]. Tariff and Trade Policy - Trump's use of tariffs is not solely aimed at reducing the trade deficit but also serves various geopolitical and economic purposes. The effectiveness of these tariffs will depend on whether they are implemented as planned [4][10]. - The potential for retaliatory measures from the EU if high tariffs are imposed is significant, and ongoing negotiations are crucial [10]. Federal Reserve Independence - Concerns about the independence of the Federal Reserve are at their highest in decades, with political influences potentially impacting monetary policy decisions [2][25][28]. - The upcoming vacancies in the Federal Reserve Board may provide Trump with opportunities to influence monetary policy further [1][25][26]. Global Economic Dynamics - The global economic landscape is shifting, with the U.S. potentially moving from an exceptional growth phase to a more normalized economic state, leading to a diversification of investments away from the U.S. [6][34]. - Other central banks are expected to have more room for rate cuts compared to the Fed, which may further influence global capital flows [7][40]. Inflation Factors - Factors contributing to rising inflation include tariffs, labor shortages due to immigration policies, and potential fiscal expansions as midterm elections approach [21][22][23]. - The impact of artificial intelligence on inflation is acknowledged, but its deflationary effects are still in early stages and may not significantly counteract inflationary pressures in the short term [31][32].

Core Viewpoint - Nomura warns that the global economy is entering an uncertain phase, with underestimation of policy risks potentially becoming a significant concern in the second half of the year [1][3][5]. Economic Outlook - The global economy is facing extreme uncertainty, particularly due to the new U.S. administration's policies and geopolitical risks [3][5]. - The U.S. is expected to experience typical stagflation pressures, with rising inflation and slowing growth, leading the Federal Reserve to be cautious and likely delaying interest rate cuts until December [1][3][5]. - Core CPI in the U.S. is projected to rebound to 3.3% in the fourth quarter due to rising import costs and tariffs impacting consumer prices [1][3][18]. U.S. Trade Policy - Trump's use of tariffs is not solely aimed at reducing the trade deficit but is influenced by various factors, including geopolitical considerations [3][8]. - The potential for retaliatory measures from the EU if high tariffs are imposed is significant, and ongoing negotiations are crucial [9][3]. Federal Reserve Independence - Concerns about the independence of the Federal Reserve are at their highest in decades, with political influence potentially affecting monetary policy [2][23][27]. - The upcoming vacancies in the Federal Reserve Board may provide Trump with opportunities to influence the central bank's direction [1][23][27]. Inflation Factors - Current low inflation levels in the U.S. are expected to rise due to tariffs, labor shortages from immigration policies, and potential fiscal policy expansions ahead of midterm elections [18][20][21]. - The impact of artificial intelligence on inflation is acknowledged, but its deflationary effects are still in early stages and may not significantly counteract inflationary pressures in the short term [29]. Market Sentiment - The market appears overly optimistic regarding the potential outcomes of the trade war, with expectations that tariffs will not significantly impact economic data [20][21]. - There is a notable shift in investment patterns, with a diversification away from U.S. assets towards European markets, driven by geopolitical pressures and economic conditions [31][32].

Macro News - The main gold futures price in Shanghai reported at 774.36 CNY per gram, with an increase of 0.41%. The opening price was 774.6 CNY per gram, with a high of 775.46 CNY and a low of 770.46 CNY [1] - Recent developments indicate that tariff negotiations between the US and Europe are accelerating, with the automotive sector being a key focus for the EU. Former Brazilian President Bolsonaro may request Trump to lift tariffs on Brazil, while current President Lula has stated that if negotiations with the US fail, reciprocal tariffs will be implemented. Chile is seeking exemption from US copper tariffs, and Vietnam has not agreed to Trump's proposed tariff increase from 11% to 20% [1] - Federal Reserve officials have indicated a consideration for interest rate cuts in the fall, with expectations of two cuts this year. There is no evidence of sustained tariff impacts on prices. The probability of the Fed maintaining rates in July is 92.8%, with a 7.2% chance of a 25 basis point cut. For September, the probability of maintaining rates is 29.7%, while the cumulative probability of a 25 basis point cut is 65.4% [1] Institutional Views - As the deadline for tariff negotiations approaches, market risk aversion has slightly returned, allowing gold to demonstrate resilience. Recent dovish comments from Federal Reserve officials have increased expectations for a rate cut in September, providing support for precious metals. Overall, despite short-term market fluctuations, the substantial increase in US tariffs is expected to lead to a rebound in inflation and economic slowdown, with the "Big and Beautiful" act likely exacerbating US debt and deficit issues. Therefore, support for precious metals is expected to remain resilient, continuing a high-level oscillation trend [1]

Core Insights - The impact of tariffs on U.S. consumer prices has been unexpectedly muted, with significant effects yet to materialize [1][2] - Goldman Sachs predicts that the core PCE inflation will rise to 3.3% by the end of 2025, with tariffs contributing approximately 1% to this increase [1][7] Delayed Transmission of Tariff Costs - The effective tariff rate is expected to increase by about 9 percentage points due to announced tariffs, with a total expected increase of around 14 percentage points [2] - As of May, the effective tariff rate had only risen by 7.2 percentage points, indicating a lag in the expected impact [2] - Three main factors contribute to this delay: the timing of tariff implementation, the ability for importers to defer tariff payments, and companies stockpiling goods ahead of tariff increases [2][5] Foreign Exporters Bearing Costs - Foreign exporters are absorbing approximately 20% of the tariff costs by lowering export prices, a significant increase from nearly zero during the 2018-2019 trade conflict [3][4] Consumer Price Transmission - The transmission of tariff costs to consumers is slow, with only 0.3% of the expected price increase realized in the first month after tariff implementation [5] - The transmission rate increases over time, reaching 40% by the third month, compared to a faster transmission during the previous trade conflict [5][6] Inflation Forecasts - Despite the delayed transmission of tariff costs, Goldman Sachs maintains its inflation forecast, estimating that announced tariffs have raised core PCE prices by about 6 basis points since January [7] - The firm anticipates that all tariff impacts will push core PCE up by approximately 1 percentage point by December, leading to an annual inflation rate of 3.3% [7]

Group 1: Price Trends and Inflation - The implementation of new tariffs by the Trump administration is leading to noticeable price increases in various retail categories, particularly in footwear, apparel, and bags, with a trend of "tagged inflation" emerging [1][2] - DataWeave's analysis shows that footwear prices have risen by approximately 4%, with specific increases of 4.2% at Macy's, 3.1% at Nordstrom, and 2% at Dillard's [1] - Apparel prices have seen more moderate increases, with Dillard's at 2%, Macy's at 1.9%, and Nordstrom at 1.8% [1] Group 2: Supply Chain and Tariff Impact - The price increase is closely linked to the type of product and supply chain structure, with footwear heavily reliant on Chinese manufacturing, making it sensitive to tariff changes [2] - A survey by the Footwear Distributors and Retailers of America (FDRA) indicates that over half of the respondents expect retail prices to rise by 6% to 10% due to increased tariffs [2] - The American Apparel and Footwear Association (AAFA) has warned that new tariffs on back-to-school items could lead to price increases of 10% to 30% [2] Group 3: Trade Agreements and Future Implications - The recent trade agreement with Vietnam, imposing a 20% tariff on Vietnamese goods and up to 40% on "transshipped" products, poses a significant challenge for brands like Nike, Lululemon, and H&M that rely on Vietnamese manufacturing [3] - Vietnam is projected to surpass China as the largest supplier of footwear to the U.S. by 2025, with 274 million pairs of shoes imported in 2024, accounting for over half of the total sneaker imports [3] - The overall import costs are expected to rise significantly due to the combination of existing tariffs and the new agreement [3] Group 4: Consumer Behavior and Market Response - Retailers are beginning to pass on the price increases to consumers, with the National Retail Federation noting that the impact of tariffs is becoming evident on retail shelves [4] - The former CEO of Walmart highlighted that consumer choices will ultimately determine whether inflation trends will solidify, as consumers may opt for non-tariffed alternatives if prices rise [4] - Investment analysts are observing that core import prices have already increased, indicating that inflationary pressures are beginning to transmit through the supply chain [4]

Core Viewpoint - The Federal Reserve's Kashkari emphasizes the need for more time to assess the impact of the trade war, suggesting that its effects may be delayed or less severe than anticipated [1] Group 1 - Focus should be on actual inflation and economic data rather than commitments to a loose policy path [1] - The potential delay in the effects of tariffs is a critical consideration for economic policy [1]

Group 1 - The core viewpoint of the article highlights the anticipation of the U.S. May core PCE price index annual rate release, which is expected to show a slight increase, indicating the initial effects of tariffs [1] - The market is closely monitoring whether this data will impact interest rate cut expectations [1]