UKRAINE: Finnish For Min Calls For Tougher Sanctions As Trump Okays Putin Meet
Speaking to Reuters, Finnish Foreign Minister Elina Valtonen calls for further sanctions on Russia, both from the EU and from the US, saying "We need to be piling up the pressure on Russia," adding "Russia's fiscal situation is not good, its economy is even worse." Valtonen claims that she is "not so worried about European leaders not being represented at upcoming talks with the US, Ukraine and Russia", claiming "we are being represented by Ukraine".
- It remains to be seen whether this is the case after 24 hours during which the prospect of Ukrainian President Volodymyr Zelenskyy meeting Russia's Vladimir Putin swung back and forth. Initially, following the meeting on 6 August between Putin and US Middle East envoy Steve Witkoff, headlines emerged suggesting a bilateral between US President Donald Trump and Putin would be followed by a trilateral including Zelenskyy. Kremlin aide Yuri Ushakov then demurred, claiming a Trump-Putin bilateral was the priority and that Moscow had given no comment on a meeting with Zelensky.
- The NY Post then reported comments from an unnamed White House official claiming that Putin “must meet with Zelensky for the [Trump] meeting to occur,” only for Trump to walk this back in comments to reporters in the Oval Office. Asked directly whether Zelenskyy's presence was required for a meeting with Putin, Trump said "no", adding “They would like to meet with me, and I’ll do whatever I can to stop the killing.”
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CROSS ASSET: A quick leg higher in Govies
- Not seen any new headline on this latest bid in Govies, seems to have started in ERU5, lifted in 5k, rest of the flows, saw Bobl and the Schatz both bought in 5k, and US TYU5 in 4k.
- This looks to be more order flow related, and not much reaction in Bonds from the extension higher in European Equites, and especially the Banking sector.
AUDNZD: Westpac Look To Enter Longs
Westpac look to enter long AUD/NZD.
- They write “in the wake of this week’s trans-Tasman central bank decisions, we are inclined to adopt a bullish bias for the weeks ahead. The RBA clearly surprised markets in a hawkish direction, while the RBNZ’s pause and guidance were largely as expected and resulted in a muted reaction.”
- Westpac note that “the cross broke above month-old resistance at 1.0845 yesterday, and while we are loathe to chase it, we would buy on any pullback to that break level. We’d target 1.1000, with a stop-loss at 1.0795”.
CHINA-EU: Foreign Min-EU Needs To Readjust Attitude, Not China
(MNI) London - Reuters reports comments from a spox from China's Foreign Ministry regarding trade concerns from the EU. Says that China, "hopes the EU can look at bilateral economic and trade relations comprehensively and positively". Says China "hopes the EU can uphold a more positive and practical China policy." Spox says that the EU "needs to reajust its attitude, not China and not China-EU trade relations." Claims that "the EU's public procurement market is far from being fair and open as the EU claims."
- These comments come amid an apparent deterioration in relations between Beijing and Brussels, only two weeks before a high-profile EU-China summit on 24 July. Even the Beijing summit itself signals the cooling of ties, with the second day of the summit focused on business ties cancelled and Premier Li Qiang set to helm the event rather than President Xi Jinping, according to Politico.
- Speaking to the European Parliament on 8 July, Commission President Ursula von der Leyen claimed that “China has an entirely different system, [it has] unique instruments at its disposal to play outside the rules,” that enables it “to flood global markets with subsidized overcapacity — not just to boost its own industries, but to choke international competition.”
- On 6 July, China announced restrictions on the purchase of medical devices made in the EU, in response to Brussels shutting China out of the bidding process for certain gov't contracts for medical devices. This tit-for-tat comes alongside more long-running disputes over EU duties on Chinese-made EVs and Chinese levies on EU spirits.
