Group 1 - The article highlights a significant capital migration towards Southeast Asian bonds as investors seek alternatives to US assets amid declining yields and concerns over US financial stability [1][2][4] - Southeast Asian countries, particularly Malaysia, Thailand, and Indonesia, have seen substantial foreign capital inflows, with Malaysia attracting nearly $5 billion this quarter due to expectations of interest rate cuts [1][2] - The average yield of 10-year bonds in Southeast Asia has dropped to the lowest level since 2011, yet demand remains strong, indicating a shift in investor sentiment [1][3] Group 2 - Singapore is emerging as a potential safe haven for investors looking for alternatives to US Treasuries, bolstered by its AAA rating and stable fiscal health [3] - The article notes that Singapore's 10-year bond yield is approximately 2.30%, close to its lowest level since March 2022, with expectations for further declines by year-end [3] - The unusual drop in Hong Kong interest rates, which remain near zero while US rates exceed 4%, signals growing investor concerns about US financial assets [4][5]

Core Viewpoint - The euro reached a one-month high against the dollar as the EU requested more time to reach a favorable agreement, and President Trump reversed his threat to impose a 50% tariff on EU goods starting June 1 [1][3]. Group 1: Currency Movements - The euro appreciated by 0.55% to 1.1418 against the dollar, marking the first increase since April 29, and has risen 10% year-to-date [1]. - The dollar index, which tracks the dollar against six other currencies, fell by 0.15% to 98.93, continuing a 1.9% decline from the previous week [3]. - The dollar weakened against the Japanese yen, dropping 0.24% to 142.23, and against the Swiss franc, falling to 0.8193, the lowest in two and a half weeks [2]. Group 2: Trade Policy and Economic Sentiment - Trump's announcement to delay tariffs until July 9 followed a request from EU Commission President Ursula von der Leyen for more time to negotiate, indicating a potential easing of trade tensions [3]. - The recent shift in Trump's stance on tariffs has led to speculation about a possible agreement with the EU before the July deadline, alleviating concerns about a global economic downturn [3]. - Analysts suggest that the current pause in tariff implementation may be temporary, and the underlying issues remain unresolved [3]. Group 3: Fiscal Policy Changes - Trump's proposed large-scale spending and tax cuts may undergo significant modifications in the Senate, reflecting concerns over fiscal sustainability [3]. - The House version of the tax bill is projected to increase federal debt by approximately $3.8 trillion over the next decade, according to the Congressional Budget Office [3]. - The shift in strategy from fiscal conservatism to growth-promoting policies is becoming a consensus view in the market, indicating a long-term downward trend for the dollar [4].