US-CHINA: China VP-Two Sides Should Safeguard 'Hard Won Outcome' From Talks
(MNI) London - Reuters reporting comments from Chinese Vice Premier He Lifeng, who led China's delegation in the talks with the US that took place in London over 9-10 June. VP says: "China's stance on trade issues with the US is clear and consistent." Says that the "Two sides should enhance consensus, strengthen cooperation, and jointly safeguard the hard-won outcome from the dialogues." He Lifeng: China and US "should maintain communication" and "push for table and long-term China-US trade and economic ties." The VP says "China is sincere in trade and economic consultations, but has its principles."
- US Commerce Secretary Howard Lutnick confirmed after the talks concluded on 10 June that a 'framework deal' would be presented to President Donald Trump. Li Chenggang, from the Chinese delegation, said the same would be presented to President Xi Jinping. This framework would implement agreements reached during previous face-to-face talks in Geneva, and from the Trump-Xi call last week.
- The main topic of the talks was not the imposition of tariffs that has dominated the global news and economic cycle for the past two months, but Chinese export controls on rare earth metals that are crucial for US supply chains and US restrictions on the export of semiconductors and other related technologies linked to artificial intelligence (AI) to China.
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Historical bullets
US TSYS: Continued flattening in the US Curves
- US Cash Govies are still trading cheaper and the belly underperforms.
- The 2s/10s, 5/30s, 10/30s curves are all flatter following the Tariffs De-escalation between the US and China.
- The 2s/10s is through the initial support seen at ~45.3, and could now target the 43.5 level, this is the very short term 61.8% retracement of the Wide April range.
STIR: Just Over 50bp Of BoE Cuts Priced Through Dec, Macro Dominates Lombardelli
Little reaction in GBP STIRs to the above comments from BoE’s Lombardell, who didn’t provide much in the way of fresh, meaningful information for markets, positioning herself in the same camp as Governor Bailey i.e. May’s decision was “finely balanced”.
- As such, broader swings in risk appetite continue to dominate.
- 3bp of cuts priced into BoE-dated OIS through June, 21bp through August, 30bp through September, 45bp through November and 51bp through year-end.
- ~50bp of cuts were priced through year-end before Lombardelli started speaking.
BoE Meeting | SONIA BoE-Dated OIS (%) | Difference vs. Current Effective SONIA Rate (bp) |
Jun-25 | 4.180 | -3.0 |
Aug-25 | 3.997 | -21.3 |
Sep-25 | 3.910 | -30.0 |
Nov-25 | 3.757 | -45.3 |
Dec-25 | 3.700 | -51.0 |
Feb-26 | 3.623 | -58.7 |
Mar-26 | 3.607 | -60.3 |
COMMODITIES: WTI Futures Approaching Key Short-Term Resistance at 50-Day EMA
A downtrend in WTI futures remains intact and short-term gains are considered corrective. The corrective cycle remains in play for now and price has traded through the 20-day EMA. Key short-term resistance to watch is $63.62, the 50-day EMA, a clear break of this level would highlight a stronger reversal. For bears a reversal lower would refocus attention on $54.67, the Apr 9 low and bear trigger. The latest pullback in Gold appears corrective. The primary trend condition is bullish and a resumption of the uptrend would signal scope for a climb towards the bull trigger at $3500.1, the Apr 22 high. Clearance of this level would confirm a resumption of the uptrend. Key short-term support has been defined at $3202.0, the May 1 low. A clear break of this level is required to signal scope for a deeper retracement.
- WTI Crude up $1.71 or +2.8% at $62.75
- Natural Gas down $0.02 or -0.4% at $3.781
- Gold spot down $94.25 or -2.83% at $3232.01
- Copper down $1.3 or -0.28% at $464.1
- Silver down $0.47 or -1.44% at $32.295
- Platinum down $14.7 or -1.47% at $987.31
