Group 1 - The core narrative of inflation concerns has weakened, leading to a strong performance in the U.S. bond market in the first half of 2025, with the 10-year Treasury yield dropping by 35 basis points, the largest decline in five years [1][3] - The easing of geopolitical tensions in the Middle East, particularly between Israel and Iran, has contributed to a decrease in oil prices from over $75 per barrel to below $65, alleviating inflation fears [3] - Despite increased tariffs leading to higher import costs for businesses, consumer inflation has remained low, with a mere 0.1% month-over-month increase in May, below the expected 0.2% [3][4] Group 2 - Economists believe that the impact of tariffs on inflation may have a lagging effect, with significant price increases potentially reflected in upcoming data [4] - Market participants have reduced their inflation concerns and adjusted their yield expectations downward, anticipating that the Federal Reserve may lower interest rates to the 3.5%-3.75% range by December 2025 [5] - The expectation of a more dovish Federal Reserve chair succeeding Powell has intensified, with market analysts predicting a higher likelihood of declining interest rates if economic conditions remain weak [6]

Core Insights - A member of the Bank of Japan indicated that due to the tendency of the US, Europe, and emerging economies towards accommodative policies, Japan's economy may experience unexpected growth or face inflationary pressures [1] Group 1 - The potential for unexpected growth in Japan's economy is linked to global monetary policies [1] - The accommodative stance of major economies could lead to inflationary pressures in Japan [1]

Economic Indicators - In May, the Consumer Price Index (CPI) decreased by 0.1% year-on-year, remaining negative for three consecutive months[6] - The Producer Price Index (PPI) fell by 3.3% year-on-year, marking the lowest since August 2023, with a decline of 0.6 percentage points[6] - Core CPI increased by 0.1 percentage points to 0.6%, indicating slight improvement in internal growth momentum despite weak demand[6] Trade and Export Data - In May, exports grew by 4.8% year-on-year, a decrease of 3.3 percentage points from April, while imports fell by 3.4%, a drop of 3.1 percentage points[6] - The trade surplus reached $103.22 billion, an increase of $6.98 billion from April[6] - Exports to the U.S. saw a significant decline, with a year-on-year drop of 34.5%, worsening by 13.5 percentage points[22] Financial Data - New RMB loans in May totaled 620 billion yuan, a decrease of 330 billion yuan year-on-year[24] - Social financing increased by 2.29 trillion yuan, up by 224.7 billion yuan year-on-year, with government bonds contributing significantly[24] - M1 growth was 2.3%, while M2 growth was 7.9%, indicating a mixed performance in monetary aggregates[32] Market Performance - The Shanghai Composite Index closed at 3362.1082, while the CSI 300 and Shenzhen Component Index were at 3843.0912 and 10051.9655, respectively[2] - The average daily trading volume increased to 1.3717 trillion yuan, up by 162.8 billion yuan from the previous week[50] - The financial sector showed strong performance, rising by 0.76%, while consumer sectors declined by 1.08%[50] Policy Outlook - The central bank's net withdrawal of 727 billion yuan in the week indicates a tightening of liquidity, with market rates slightly rising[7] - Future monetary policy is expected to remain accommodative, with a focus on supporting economic recovery amid ongoing uncertainties[39] - The upcoming tax period may cause temporary disruptions in the funding environment, necessitating close monitoring of central bank operations[39]

Core Viewpoint - Traders are increasing their bets on an 80% probability of the Bank of England cutting interest rates in August, with expectations of an additional 50 basis points reduction this year [1] Group 1 - The likelihood of a rate cut by the Bank of England has risen significantly, indicating a shift in market sentiment towards monetary easing [1] - The anticipated reduction in interest rates reflects concerns over economic conditions and the need for supportive monetary policy [1]

Core Viewpoint - The European Central Bank (ECB) is closely monitoring the spillover effects of energy prices and may adjust its policy if the impact persists [1] Group 1: Policy Monitoring - The ECB is observing the inflation suppression effects of the recent euro appreciation [1] - If the ECB takes action within the next six months, it is more likely to be a loosening policy [1] - The ECB's policy must remain flexible while still being predictable [1] Group 2: Interest Rates and Economic Outlook - The ECB's interest rates are very close to the center of the neutral range, indicating that the policy process may not be over yet [1] - The ECB should not become complacent or passive in its approach [1]

日本央行行长植田和男：减少宽松政策对宏观经济的负面影响不大。 ...

Group 1 - Geopolitical risks have re-emerged as a primary focus in trading, with complex reactions in currency and interest rate markets compared to traditional safe-haven assets [1] - The USD/JPY exchange rate is currently fluctuating between 143.90 and 144.74, with a strong short-term technical structure above key moving averages [4] - The market anticipates that the Bank of Japan will maintain its short-term interest rate target at 0.5% until at least Q1 2026, limiting the potential for policy tightening [4][5] Group 2 - The recent escalation of tensions in the Middle East has led to rising international oil prices, providing temporary support for the USD while having a limited positive impact on the JPY [6] - The USD is expected to strengthen against the JPY, with analysts predicting a potential rise to 155 by the end of the year due to structural capital outflows from Japan and upcoming fiscal uncertainties [7] - The JPY is underperforming against other major currencies like the EUR and AUD, influenced by the stabilization of Eurozone policies and commodity price movements [6]

Group 1 - German economist Martin Luecke stated that the U.S. government's debt and tariff policies are pushing the country towards a financial crisis, describing these policies as a "disastrous operation manual for a complete collapse" [1] - California Attorney General Rob Bonta indicated readiness to sue to protect local businesses if President Trump proceeds with tariffs against Apple, which is headquartered in Cupertino, California [1] - President Trump expressed agreement with Treasury Secretary Mnuchin's comments that the U.S. does not need to bring textile manufacturing back domestically, focusing instead on manufacturing "big items" like chips, computers, and AI [1] Group 2 - European Central Bank President Christine Lagarde highlighted that the current world order is fundamentally shaken, with multilateral cooperation being replaced by zero-sum thinking and power struggles, which could pose risks to Europe [2] - German Vice Chancellor and Finance Minister Lars Klingbeil emphasized the need for the EU to focus on a solution that benefits both Europe and the U.S. [2] - The Japanese government plans to allocate 900 billion yen to mitigate rising electricity and gas costs and support small and medium-sized enterprises, with total project scale expected to reach 2.8 trillion yen [2] Group 3 - U.S. crude oil futures remained flat at $61.53 per barrel, while Brent crude oil futures increased by 0.05% to $64.81 per barrel [3] Group 4 - COMEX gold futures fell by 0.7% to $3342.2 per ounce, while COMEX silver futures rose by 0.11% to $33.645 per ounce [4] - Eurozone bond yields declined, with France's 10-year bond yield down by 2.4 basis points to 3.234%, Germany's by 0.7 basis points to 2.558%, Italy's by 3 basis points to 3.552%, and Spain's by 1.3 basis points to 3.174% [4] - The U.S. dollar index decreased by 0.1% to 99.012, with various currency exchange rates showing slight fluctuations against the dollar [4] Group 5 - The onshore Chinese yuan closed at 7.1843 against the U.S. dollar, appreciating by 52 basis points from the previous trading day [5]

日本央行行长植田和男：日本央行已经成功地将让通胀预期脱离"零"，但尚未将其重新锚定在2%，这 就是我们仍然保持宽松政策立场的原因。 ...

大摩：尽管4月通胀高企，英国央行料仍坚持宽松政策 金十数据5月21日讯，摩根士丹利的分析师Bruna Skarica在一份报告中表示，尽管英国4月份的通胀率高 于预期，但英国央行可能会坚持其宽松政策的路线。她说，3.5%的年度CPI涨幅并不是一个特别大的打 击喜，因为这是由行政和旅游一次性支出推动的。不过，即便5月通胀可能更为温和，且6月就业市场报 告将显示薪资增长出现明显下滑，英国央行6月降息似乎不太可能。Skarica表示："在8月份之前，很多 事情都可能发生。"包括通胀预期下降。她说："我们仍然预计利率会下调，并在年底前连续下调至 3.25%。" ...