MNI US OPEN - Israel Plays Down Chance of Imminent End to War
EXECUTIVE SUMMARY
- TRUMP UNVEILS NEW TARIFF RATES, INCLUDING 50% LEVY ON BRAZIL
- INDIA TEAM LIKELY TO VISIT US SOON TO ADVANCE TRADE TALKS
- RUBIO TO MEET LAVROV WHILE US SENDS MORE WEAPONS TO UKRAINE
- ISRAELI OFFICIAL PLAYS DOWN CHANCE OF IMMINENT END TO GAZA WAR
Figure 1: USD/BRL spikes on Trump's 50% tariff announcement (chart shows high price)
Source: MNI/Bloomberg Finance L.P.
NEWS
US/BRAZIL (BBG): Trump Unveils New Tariff Rates, Including 50% Levy on Brazil
US President Donald Trump unveiled a new round of tariff demand letters on Wednesday, including a 50% rate on Brazil, one of the highest so far announced for the levies which are set to hit in August. Trump cited the treatment of former President Jair Bolsonaro — a right-wing populist leader — in his letter to Brazil, calling on authorities to drop charges against him over an alleged coup attempt. “This Trial should not be taking place. It is a Witch Hunt that should end IMMEDIATELY!” Trump wrote in the letter.
US (BBG): Trump Says 50% Tariff on Copper Imports to Take Effect August 1
President Donald Trump said the US would begin levying a 50% tariff on copper imports from Aug. 1, confirming a move that will hurt American producers of everything from automobiles to appliances. The higher-than-expected levy was signaled by Trump in comments to reporters on Tuesday, but the president took to Truth Social late Wednesday to confirm the start date — and blamed previous administrations for the decline of America’s copper clout.
US/INDIA (BBG): India Team Likely to Visit US Soon to Advance Trade Talks
An Indian trade delegation is likely to visit Washington in the coming days for further talks on a trade deal, according to an official familiar with the matter. The talks are expected to cover both the interim and the broader bilateral agreements, the official told reporters in New Delhi on Thursday, asking not to be identified as discussions are still ongoing.
US/RUSSIA (BBG): Rubio to Meet Lavrov While US Sends More Weapons to Ukraine
US Secretary of State Marco Rubio is scheduled to meet his Russian counterpart Thursday as the US prepares to send more weapons to Ukraine to help it fend off attacks from the Kremlin’s war machine. Rubio and Russian Foreign Minister Sergei Lavrov are expected to hold talks on the sidelines of an Association of Southeast Asian Nations gathering in Kuala Lumpur, the State Department said.
ISRAEL (BBG): Israeli Official Plays Down Chance of Imminent End to Gaza War
A senior Israeli official played down the chances of an imminent end to the war in Gaza, even as US President Donald Trump said negotiators were “very close” to a ceasefire. The Israeli official, granted anonymity to speak about the progress of the negotiations, indicated a truce with Hamas could be agreed to in a week or two but may not evolve into a de facto end to a war that’s lasted more than 21 months and destabilized the wider Middle East.
CANADA (BBG): Canada Seeks Southeast Asia Trade Deal to Blunt Trump Tariffs
Canada’s top diplomat said she aims to finalize a free trade agreement with Southeast Asian nations “as soon as possible,” as the country looks to expand economic ties in the face of tariffs from President Donald Trump. “We are diversifying and we are establishing those trade relationships,” Anita Anand, who has been Canada’s foreign minister since May, told Bloomberg TV Thursday on the sidelines of an Association of Southeast Asian Nations summit in Kuala Lumpur. “We are currently negotiating with Asean a free trade agreement, and we look forward to the conclusion of those negotiations.”
EU COMMISSION (MNI): VdL to Face Confidence Vote ~12:00CET, Ouster Extremely Unlikely
MEPs will vote later today on a motion of censure against Commission President Ursula von der Leyen. The motion is extremely unlikely to pass, with the moderate political groups set to vote against, ensuring that the thresholds for the ouster of the president and her entire College of Commissioners will not be reached. Nevertheless, the motion being put forward and the associated debates have allowed for an expression of frustration and anger with VdL from political groups on the left what they view as a rightward shift of the Commission.
UK/FRANCE (BBG): UK, France Deepen Nuclear Cooperation in Bid to Deter Russia
The UK and France will agree to strengthen their cooperation on nuclear deterrence, formally declaring a willingness to coordinate any response to an extreme security threat in Europe. The two nuclear-armed members of the UN Security Council will highlight deeper defense ties during meetings between UK Prime Minister Keir Starmer and French President Emmanuel Macron on Thursday in London.
CHINA (BBG): Nvidia’s Huang to Meet Chinese Leaders While AI Curbs Deepen
Nvidia Corp. co-founder Jensen Huang will meet with senior Chinese officials in Beijing next week, signaling the company’s commitment to a vast market Washington is increasingly seeking to isolate. The chief executive officer is seeking discussions with leaders including the commerce minister, a person familiar with the situation said. Huang is planning those meetings while attending the International Supply Chain Expo in Beijing next week, the person said, asking to remain anonymous discussing a plan still in flux. That conference is one of the Chinese government’s signature events, and has featured the likes of Apple Inc.’s Tim Cook in the past.
BOK (MNI): BOK Keeps Policy Rate Unchanged at 2.50%, Governor Cautiously Flags Cuts
Bank of Korea Governor Rhee Chang-yong on Thursday signalled further rate cuts ahead amid a deteriorating economic outlook, but refrained from detailing the timing, following the board’s decision to hold the base rate at 2.5%. “Regarding future monetary policy, the Board considers it necessary to continue its rate-cut stance, given that inflation remains broadly stable and economic growth is forecast to remain low for the time being,” Rhee said at a press event following the board’s largely expected unanimous decision.
S.KOREA (BBG): South Korea’s Ex-President Yoon Arrested in Martial Law Probe
A South Korean court issued a warrant to arrest former President Yoon Suk Yeol, putting him back in detention four months after he was released over his botched attempt to put the country under martial law. The Seoul Central District Court issued the warrant early Thursday, citing the risk of Yoon destroying evidence, a special counsel team looking into his case said. It’s Yoon’s second detention since he shocked the nation and the world by briefly imposing martial law in early December.
BOJ (MNI): BOJ Sees Mixed U.S. Trade Policy Impacts
Bank of Japan branch managers reported mixed views on how U.S. trade policy is affecting capital investment, price-setting, and production, according to the BOJ’s regional economic report released Thursday. “Capital investment to increase capacity will be postponed for a half year” due to heightened uncertainties caused by the trade policy, an electric machinery firm said. An automobile-related firm said it is reviewing capex and proceeding with cost cuts as profits are set to fall due to the tariffs, while a chemical firm noted it would implement capital investment as planned, despite high uncertainties.
BOJ (MNI): All Regions Report Recovery, Picking Up - BOJ
All nine Japanese regions reported moderate economic recoveries in the Bank of Japan’s quarterly regional economic report released Thursday, with assessments ranging from “recovering moderately” to “picking up,” although some noted partial weakness. All regions left their economic assessments unchanged from the previous meeting in April, marking the second straight meeting without revisions. Private consumption and capital investment were described by regional managers favourably, suggesting that the impact of U.S. trade policy has so far been limited.
BRAZIL (MNI): Trump’s 50% Tariff Announcement Sparks Punchy BRL Selloff
The Brazilian real had already been under pressure late Wednesday as President Trump stated that “Brazil has not been good to us” in comments that preceded the significant announcement of 50% tariffs to be imposed from August 01. The second leg of BRL weakness prompted a dramatic spike for USDBRL to 5.60, extending the pair’s advance to 2.88% before settling around 5.57 into the close. This announcement represents a major escalation from the 10% rate imports from Brazil to the US have faced since April and while the potential economic impact is clear, it is the political angle to Trump’s latest action that might be particularly poignant for markets.
DATA
UK DATA (MNI): ONS Releases Update on PPI Data; Immediate Market Impact Limited
The ONS has released some updated PPI data, albeit acknowledging that there are still some errors in these data that have not been ironed out yet. It has noted that it expects "there is some additional work to undertake, though further corrections are mostly expected to be small in magnitude." The ONS "intend to reinstate full publication of our monthly PPI and quarterly SPPI bulletins in October 2025" but the decision has been made to publish some data as the ONS "acknowledge the value to users of having PPI and SPPI statistics in the public domain to inform policy and decision-making."
GERMANY DATA (MNI): Final German June Data Confirms Soft Services
- GERMANY FINAL JUNE HICP 2.0% Y/Y
German final June HICP was unrevised from the flash readings at 2.0% Y/Y (2.1% prior) and 0.1% M/M. The final reading to CPI was also unrevised at 2.0% Y/Y (2.1% prior) and 0.0% M/M. Core CPI printed at 2.7% Y/Y (2.8% prior). Overall, the CPI data confirms the main conclusions from the flash reading. Services decelerated to 3.3% (as projected by MNI after state-level data, that was a downside surprise to consensus), the lowest rate since December 2023, with the contribution vs May falling 0.05pp.
NORWAY DATA (MNI): Volatiles Push Services Higher in June, Momentum Eases to 3.5 Year Low
- NORWAY JUN CPI +0.2% M/M, +3% Y/Y
- NORWAY JUN UNDERLYING CPI +0.5% M/M, +3.1% Y/Y
Norwegian June CPI-ATE inflation was 3.07% Y/Y (vs 2.77% prior, 3.0% consensus and 3.1% Norges Bank). On a seasonally adjusted basis using Statistics Norway data, prices rose 0.3% M/M, the highest sequential print since February. Still, 3m/3m annualised inflation momentum eased to 2.33% from 3.06% in May and 4.11% in April - the lowest reading since December 2021. There's still another CPI report before Norges Bank's August 14 decision. Today's reading is consistent with expectations for a quarterly pace of cuts continuing in September.
SWEDEN DATA (MNI): Monthly GDP Indicator Dragged Lower by Weak Retail Sales Report
The Swedish monthly GDP indicator fell 0.2% M/M in May, in line with the three-analyst strong consensus (range -0.4% to -0.2%). On a 3m/3m basis, GDP fell 0.1%, above April's weak -0.7% reading but still the third consecutive negative print. The Riksbank projected Q2 GDP at 0.9% Q/Q in the June MPR. Although the monthly activity indicator isn't best predictor of actual GDP outcomes, and can sometimes be revised quite heavily, that forecast still seems optimistic.
JAPAN DATA (MNI): June CGPI Rises 2.9% Y/Y; Import Price Drops
- JAPAN JUNE CORP GOODS PRICE INDEX +2.9% Y/Y; MAY +3.3%
- JAPAN JUNE CORP GOODS PRICE INDEX -0.2% M/M; MAY -0.1%
Japan’s corporate goods price index (CGPI) rose 2.9% y/y in June, easing from May’s revised 3.3%, data released by the Bank of Japan showed Thursday. The index fell 0.2% m/m, following a 0.1% decline in May, marking the second consecutive monthly drop. The slowdown was driven by a sharp decline in petroleum and coal products (-4.6% vs. +0.8%) and a moderation in electric power, gas and water prices (+3.5% vs. +6.4%).
FOREX: Tariff Letters Show Trump Not Shy of Surprising Markets
- As more tariff letters dropped late yesterday, markets were again caught offguard at Trump's willingness to surprise markets - this time by inflicting a 50% tariff rate on Brazil due to the country's pursuit of former President Bolsonaro, a key Trump ally. The local currency sold off aggressively, putting USD/BRL at new July highs - although the spillover into G10 FX was much more muted - however the brief spell of USD sales in response to the headline persists headed through to the NY crossover.
- For now, this keeps broader market conditions in step with the themes from earlier this week. AUD/USD remains firm, with an underlying bull trend aided by the recovery off weekly lows and the firm hold of 50-dma support at 0.6483. Further strength here would need to top 0.6590 resistance, a break above which puts the pair at YTD highs and resumes the underlying bull trend.
- While the USD Index is softer, it is still operating above the base in prices established earlier this month. The dominance of the USD downtrend posted off the early February has helped define price action across Trump's term so far - and that remains the order of markets for now. Any fresh catalysts this month (US CPI on July 15th, Fed decision on July 30th) will need to press the USD either back below the downtrendline (today at 97.083) or above the 50-dma at 98.913 to trigger fresh price action here.
- Weekly jobless claims data are the sole US data release due Thursday, with markets watching for another tick higher in initial jobless claims to 235k. The central bank speaker slate is busier, with ECB's Villeroy, BoE's Breeden and Fed's Musalem & Daly all set to speak.
EGBS: Bearish Theme in Bunds Remains Intact
Bund futures are down 12 ticks at 129.67, currently at fresh session lows. A bearish theme in Bunds remains intact, with yesterday’s low at 129.54 providing the initial downside target. On the upside, resistance around the 50-day EMA, at 130.44, has recently been pierced but for now, remains intact. A clear break of it is required to highlight a possible reversal.
- Futures volumes are once again below recent averages, with little market moving headline flow to note this morning.
- The German curve has lightly bear steepened, with 30-year yields up 2bps and 10s30s just below the 50bp handle.
- German final June HICP confirmed flash estimates at 2.0% Y/Y, with services inflation confirmed as soft. Meanwhile, Italian May industrial production was weak.
- Light outperformance in 10-year peripheral spreads to Bunds, with BTP, SPGB and PGB spreads ~1bp tighter.
- ECB’s Cipollone, Escriva and Villeroy are schedule to speak today, but we don’t expect any new signals.
GILTS: Off Highs, Curve Twist Flattens
Bulls managed to close yesterday’s opening gap lower in futures, with the contract topping out at 92.19 before a fade back below 92.00.
- Bears are in technical control, bulls need to break the 20-day EMA (92.45).
- Yields 1bp higher to 2p lower. Curves flatter as the pullback from multi-week highs in 2s10s and 5s30s extends.
- Late Wednesday rally in Tsys (auction & tariff-related) provided the initial bid.
- Bunds and Tsys have faded from Asia highs, limiting the rally in gilts to some degree.
- Little in the way of major UK news flow this morning.
- A lagged/partial ONS update on PPI data has had little impact (see earlier bullet for greater detail there).
- Most benchmark UK yields, as well as short and medium-term forward rates, continue to trade somewhere between the lows and mids of the ranges witnessed since early April.
- Ongoing worry surrounding an already tepid UK growth outlook, the growing risk of further tax hikes and a slightly more dovish market outlook for the BoE anchor those rates.
- 20+-Year gilt yields provide the exception to the theme, last operating between mids and highs seen over the same period. Local and global fiscal factors have steepened curves multi-week.
- GBP STIRs are little changed on the day, 52bp of BoE cuts priced through Dec.
- BoE’s Breeden will speak on “Weathering the storm: stability in a changing climate’” this evening (text 16:00, speech 18:45).
EQUITIES: Eurostoxx 50 Futures Narrow Gap to Key Resistance and Bull Trigger
Eurostoxx 50 futures have traded higher this week as the contract extends the recovery that started Jun 23. This exposed key resistance and the bull trigger at 5486.00, the May 20 high. It has been pierced, a clear break would confirm a resumption of the medium-term bull cycle that began Apr 7, and would open the 5500.00 handle. On the downside key support has been defined at 5194.00, the Jun 23 low. The trend condition in S&P E-Minis remains bullish and the contract is trading closer to its recent highs. Resistance at 6128.75, the Jun 11 high, has recently been breached. The break confirmed a resumption of the uptrend that started Apr 7. This was followed by a breach of key resistance and a bull trigger at 6277.50, the Feb 21 high. Sights are on 6356.12, a Fibonacci projection. Key support is at the 50-day EMA, at 6032.93.
- Japan's NIKKEI closed lower by 174.92 pts or -0.44% at 39646.36 and the TOPIX ended 15.82 pts lower or -0.56% at 2812.34.
- Elsewhere, in China the SHANGHAI closed higher by 16.632 pts or +0.48% at 3509.682 and the HANG SENG ended 136.05 pts higher or +0.57% at 24028.37.
- Across Europe, Germany's DAX trades higher by 63.82 pts or +0.26% at 24615.38, FTSE 100 higher by 93.46 pts or +1.05% at 8961.07, CAC 40 up 49.68 pts or +0.63% at 7928.14 and Euro Stoxx 50 up 18.57 pts or +0.34% at 5464.22.
- Dow Jones mini down 108 pts or -0.24% at 44614, S&P 500 mini down 8.25 pts or -0.13% at 6299, NASDAQ mini down 16.25 pts or -0.07% at 23037.
Time 10:00 BST
COMMODITIES: Gold 50-Day EMA Support Holding for Now
WTI futures maintain a bearish tone following the reversal from the Jun 23 high, and recent gains are considered corrective. Support to watch is the 50-day EMA, at $65.22. The average has been pierced, a clear break of it would signal scope for a deeper retracement. This would expose $58.87, the May 30 low. Initial resistance to watch is $71.20, the 50.0% retracement of the Jun 23 - 24 high-low range. Key resistance is at $78.40, the Jun 23 high. Recent weakness in Gold resulted in a breach of the 50-day EMA, and a trendline drawn from the Dec 30 ‘24 low and connected to the Feb 28 low. A clear break of both trend tools would signal scope for a deeper correction, and open $3245.5, May 29 low. Note, the recovery from the Jun 30 low also highlights a possible false t-line break. A resumption of gains would refocus attention on $3451.3, Jun 16 high. The bear trigger is $3248.7, Jun 30 low.
- WTI Crude down $0.37 or -0.54% at $67.99
- Natural Gas up $0.02 or +0.72% at $3.238
- Gold spot up $16.16 or +0.49% at $3329.88
- Copper up $11.35 or +2.07% at $559.8
- Silver up $0.27 or +0.74% at $36.6577
- Platinum up $10 or +0.74% at $1361.86
Time 10:00 BST
| Date | GMT/Local | Impact | Country | Event |
| 10/07/2025 | - | *** |  CN | Money Supply |
| 10/07/2025 | - | *** | CN | New Loans |
| 10/07/2025 | - | *** | CN | Social Financing |
| 10/07/2025 | 1230/0830 | *** |  US | Jobless Claims |
| 10/07/2025 | 1230/0830 | ** | US | WASDE Weekly Import/Export |
| 10/07/2025 | 1400/1000 | US | St. Louis Fed's Alberto Musalem | |
| 10/07/2025 | 1430/1030 | ** | US | Natural Gas Stocks |
| 10/07/2025 | 1500/1600 |  GB | BOE Breeden On Climate Change | |
| 10/07/2025 | 1530/1130 | ** | US | US Bill 04 Week Treasury Auction Result |
| 10/07/2025 | 1530/1130 | * | US | US Bill 08 Week Treasury Auction Result |
| 10/07/2025 | 1700/1300 | *** | US | US Treasury Auction Result for 30 Year Bond |
| 10/07/2025 | 1715/1315 | US | Fed Governor Christopher Waller | |
| 10/07/2025 | 1830/1430 | US | Fed's Mary Daly at MNI | |
| 11/07/2025 | 0600/0700 | *** | GB | UK Monthly GDP |
| 11/07/2025 | 0600/0700 | ** | GB | Trade Balance |
| 11/07/2025 | 0600/0700 | ** | GB | Index of Services |
| 11/07/2025 | 0600/0700 | ** | GB | Index of Production |
| 11/07/2025 | 0600/0700 | ** | GB | Output in the Construction Industry |
| 11/07/2025 | 0645/0845 | *** |  FR | HICP (f) |
| 11/07/2025 | 1130/1330 |  EU | ECB Cipollone At Ukraine Recovery Conference | |
| 11/07/2025 | 1230/0830 | *** |  CA | Labour Force Survey |
| 11/07/2025 | 1230/0830 | * | CA | Building Permits |
| 11/07/2025 | 1600/1200 | *** | US | USDA Crop Estimates - WASDE |
| 11/07/2025 | 1700/1300 | ** | US | Baker Hughes Rig Count Overview - Weekly |
| 11/07/2025 | 1700/1300 | ** | US | Baker Hughes Rig Count Overview - Weekly |
| 11/07/2025 | 1800/1400 | ** | US | Treasury Budget |
