Core Viewpoint - The Argentine Senate has overturned President Milei's veto of a fiscal fund distribution mechanism, which will now be reviewed by the Chamber of Deputies, indicating ongoing tensions between the executive and legislative branches [1] Group 1: Legislative Actions - The fiscal fund distribution mechanism accounts for 1% of Argentina's federal tax revenue and aims to address emergencies and fiscal imbalances in provinces [1] - The Senate and Chamber of Deputies passed the new fiscal fund distribution mechanism on July 10 and August 20, respectively, to support local finances and public services through automatic allocation [1] - President Milei vetoed the bill on September 12, arguing that automatic allocation would weaken federal control over fiscal resources and hinder fiscal balance goals [1] Group 2: Political Dynamics - Analysts note that President Milei has long lacked stable support in Congress and has not built a reliable political coalition [1] - Since August, Congress has repeatedly overturned Milei's vetoes, highlighting the deepening divide between the President and Congress [1] - The economic reform plan focused on reducing fiscal deficits and controlling inflation may face further obstacles due to these ongoing conflicts [1]

Core Points - The Argentine Congress overturned President Milei's veto on pediatric and higher education bills, which will now be reviewed by the Senate [1] - The bills aim to allocate special budgets to public pediatric hospitals, ensure healthcare personnel salaries, and provide more resources to public universities while increasing faculty salaries [1] - President Milei vetoed these bills citing concerns over fiscal balance [1] Legislative Process - According to Argentine law, the president can veto bills passed by Congress, but if two-thirds of both houses vote against the veto, the bill can become law [1] - Some members of Milei's ruling coalition, the "Libertarian Forward Party," and centrist lawmakers voted against the veto in the House, indicating potential instability within the political alliance [1] Economic Context - Since taking office in December 2023, President Milei has implemented a series of economic reforms aimed at reducing fiscal deficits and controlling inflation [1] - The "Libertarian Forward Party" faced a setback in the Buenos Aires provincial elections on September 7, reflecting public skepticism towards the government's economic reforms [1] - In a televised address on September 15, Milei emphasized that achieving fiscal balance is a non-negotiable goal for the 2026 budget [1]

Core Viewpoint - Argentine President Milei emphasized the commitment to fiscal balance in his address regarding the 2026 budget, stating that achieving this goal is essential for the country's economic growth and to avoid hyperinflation [1] Economic Outlook - The budget proposal submitted to Congress forecasts a 5% growth in Argentina's GDP for 2026 [1] - The expected inflation rate for 2026 is projected at 10.1% [1]

Core Viewpoint - Argentine President Milei emphasized the commitment to fiscal balance in his address regarding the 2026 budget, stating that achieving this goal is crucial for economic growth after decades of stagnation, while failure to do so could lead to uncontrollable inflation [1] Group 1: Economic Policy - President Milei reiterated that fiscal balance is a non-negotiable goal, which he believes will lead to unimaginable growth for the Argentine economy [1] - The 2026 budget allocates 4.8 trillion pesos to public universities, with pension and public healthcare expenditures increasing by 5% and 17% respectively, both exceeding the inflation rate [1] Group 2: Political Context - The ruling coalition "La Libertad Avanza" faced a setback in the Buenos Aires provincial assembly elections, contributing to a decline in Milei's government approval ratings [1] - Allegations of bribery involving key government officials have added to the uncertainty surrounding the upcoming midterm elections in October [1] Group 3: Market Reaction - On the day of Milei's address, Argentina's country risk index surpassed 1200 points, indicating ongoing financial market volatility [1]

Core Viewpoint - Argentine President Milei emphasized the commitment to fiscal balance in his address regarding the 2026 budget, stating that achieving this goal is crucial for economic growth after decades of stagnation, while failure could lead to uncontrollable inflation [1] Budget and Economic Policy - The 2026 budget allocates 4.8 trillion pesos for public universities, with pension expenditures and public healthcare spending increasing by 5% and 17% respectively, both exceeding the inflation rate [1] - Milei reiterated the importance of creating conditions for businesses to be profitable and expressed a desire to increase investments [1] Political Context and Challenges - The ruling coalition "La Libertad Avanza" faced a setback in the Buenos Aires provincial assembly elections, contributing to a decline in Milei's government approval ratings [1] - Allegations of bribery involving key government officials have added to the political uncertainty, impacting financial markets ahead of the upcoming midterm elections in October [1] - On the day of Milei's address, Argentina's national risk index surpassed 1200 points, indicating heightened financial market volatility [1]

Core Viewpoint - The article discusses the potential risks and uncertainties facing the U.S. economy in the second half of 2025, particularly focusing on the impact of tariffs and the "Beautiful America Act" on economic performance and market behavior [1][2]. Group 1: Economic Outlook - The IMF has revised down the global GDP growth forecast for 2025 to 2.8%, a decrease of 0.5 percentage points from January, with the U.S. forecast lowered from 2.7% to 1.8%, a drop of 0.9 percentage points [1]. - There is a need to guard against the risk of an unexpected economic downturn, especially if the unemployment rate rises to the range of 4.4% to 4.6%, which could trigger a "recession trade" in the market [2][5]. Group 2: Tariffs and Legislative Impact - The two main themes for the second half of 2025 are the verification of tariff data and the potential impact of the "Beautiful America Act" [2]. - The introduction of Tariff 2.0 has increased uncertainty regarding trade, industrial production, and economic growth in the latter half of the year [1]. Group 3: Currency Dynamics - The article suggests that under the influence of a slowing U.S. economy and anticipated interest rate cuts by the Federal Reserve, the U.S. dollar may further depreciate, leading to a passive appreciation of the Renminbi against the dollar [8]. - If the U.S. moves towards fiscal balance following the implementation of the "Beautiful America Act," it could create additional space for interest rate cuts, potentially continuing the trend of gradual dollar depreciation [8].

Group 1 - Malaysia has implemented significant adjustments to the Sales and Service Tax (SST) starting July 1, imposing a 5% to 10% sales tax on non-essential and luxury goods, while expanding the service tax scope [1][2] - The new tax policy aims to broaden the tax base and increase fiscal revenue while selectively avoiding essential goods to mitigate the burden on the general public [1][4] - Luxury items such as imported salmon, high-end fruits, and truffles are taxed at 5%, while high-value collectibles like antiques and luxury cars are taxed at 10%, reflecting the government's consideration of consumer spending capacity [1][2] Group 2 - The expansion of the service tax includes sectors like leasing, construction, financial services, education, and beauty services, addressing long-standing gaps in the tax base [2][3] - The tax reform is part of the "Prosperous Economy" reform framework, emphasizing sustainable fiscal policies and social inclusivity while avoiding taxes on basic necessities [2][4] - Measures have been introduced to alleviate the impact on small and medium-sized enterprises (SMEs), including exemptions for those with rental income below 500,000 MYR (approximately 117,900 USD) [3][4] Group 3 - The additional tax revenue will be allocated to enhance public services, expand cash assistance, and improve infrastructure and healthcare resources, aiming to reduce the budget deficit from approximately 4.3% in 2024 to 3.8% in 2025 [4] - The tax reform is designed to maintain basic government operations while gradually building a more robust tax system, balancing moderate adjustments with progressive reforms [4] - The government asserts that the tax burden will not increase on essential goods for the general public, but higher-income individuals will contribute more to address future economic pressures [4]

Core Insights - Bank of America Merrill Lynch warns that Trump's "Big Beautiful Plan" will not achieve fiscal balance through growth effects and will provide limited economic growth stimulus [1][2] Group 1: Economic Impact - The plan is estimated to cost $2.3 trillion but will only generate $102.8 billion in revenue feedback, resulting in a self-financing ratio of only 4.5% [2][3] - To achieve self-financing, GDP needs to grow by approximately 9% by the fiscal year 2034, which is deemed nearly impossible [2][3] Group 2: Growth Projections - The Joint Committee on Taxation (JCT) projects that the plan will only increase GDP by an average of 3 basis points over the next 10 years, with a maximum increase of 0.4% by the fiscal year 2034 [3][4] - Economic effects from 2025 to 2034 are projected as follows: Output increase of 0.4%, Business capital decrease of 0.1%, Labor increase of 0.6%, and Consumption increase of 0.8% [3][4] Group 3: Comparison with Other Estimates - The Tax Foundation estimates that the plan will lead to a long-term GDP growth of 0.8%, covering about one-third of its costs [4] - The Wharton School predicts a GDP growth of 0.4% in the first decade, raising the annual growth rate from 1.8% to 1.85% [4] - The Yale Budget Lab suggests that the plan may raise growth rates from 1.8% to about 2% by 2027, but federal debt will eventually reverse this effect [4]

Group 1: Market Outlook - Morgan Stanley is optimistic about the Chinese stock market, with a baseline expectation for the MSCI China Index at 80 and a target for the CSI 300 Index at 4150 points [1] - UBS sees foreign capital inflow as a significant trading logic for the Chinese stock market in the coming quarters, with Hong Kong stocks expected to outperform A-shares [1] - Deutsche Bank analysts express concerns about fiscal balance in countries outside the US, highlighting Japan's low demand for 20-year bonds as a sign of fiscal stress [1] Group 2: Economic Indicators - Barclays analysts predict a potential further decline in the US dollar, but strong economic data may limit the extent of the drop [2] - ANZ analysts note that the downgrade of the US credit rating by Moody's has reignited interest in gold due to concerns over economic slowdown and rising inflation [3] - CBA forecasts gold prices to reach $3750 per ounce in Q4, driven by safe-haven demand and a weakening dollar [4] Group 3: Industry Insights - CICC reports that the domestic nutrition and health food industry has significant long-term growth potential, with a market size exceeding $35 billion [5] - CITIC Securities indicates that the pesticide industry in China is accelerating consolidation, with leading companies enhancing competitiveness through mergers and acquisitions [6] - CITIC Securities also highlights that the domestic wind turbine industry is expected to enter a phase of simultaneous growth in volume and price due to improved supply-demand dynamics [7]

Core Viewpoint - Concerns about fiscal balance are not limited to the United States, with Japan's recent bond auction demand hitting a 10-year low, indicating broader global debt worries [1] Group 1: Debt Levels - The debt-to-GDP ratios for the US and UK stand at 100%, while Japan's is significantly higher at 250% [1] - In 1999, the debt-to-GDP ratios for these countries were much lower, at 41% for the US, 42% for the UK, and 113% for Japan [1] Group 2: Bond Market Dynamics - The current environment presents unprecedented challenges for the long-term bond market, as it has not been experienced in over 30 years amid high global debt levels [1] - An increase in bond supply is anticipated in the coming years, creating a pressing need for inflation control in the long-term market [1]