Morning Wrap (08.08.2025)

Asia-Pacific indices show little change on the final trading day of the week. Chinese indices are down between 0.30–0.45%, Australia’s main index is up 0.15%, and Singapore’s SG20cash is down 0.15%. The standout is Japan’s JP225, gaining 1.60% following an update on trade terms.

Japan secured a U.S. commitment to amend a presidential tariff order and refund overpaid duties, capping all affected goods at a 15% maximum rate. The revised agreement also lowers U.S. auto tariffs from 27.5% to 15% and applies to both existing and new duties. Japanese officials expressed regret over the initial discrepancies but stressed there was no dispute over reciprocal tariffs.

In response to the news, USDJPY also strengthened above 147.350.

The Bank of Japan’s July Summary of Opinions revealed divisions over the timing of the next rate hike. Some members warned that delaying action could require sharper tightening later, while others argued for patience due to economic uncertainty. Inflation risks, trade, and geopolitical factors were in focus.

The Bank reaffirmed its readiness to tighten if the economy and prices align with projections. This news had no notable currency impact, and the yen continues to weaken on the daily timeframe.

The U.S. imposed 15% tariffs on strategic large gold bars (1 kg and 100 oz) used for COMEX delivery. This move could disrupt links between London and New York, force short positions to close or roll over, and tighten funding conditions in the London bullion-bank system.

It is also expected to accelerate Basel III–driven changes toward physical metal holdings and reduce Switzerland’s dominance in refining. COMEX’s influence over global gold price discovery will likely increase.

JP Morgan now expects the Fed to ease policy more aggressively, beginning rate cuts in September. The bank cites labor-market weakness as the key driver of this dovish shift. Fed funds futures are currently pricing in about 59 bps of cuts by year-end, leaving room for further adjustment in expectations.

President Donald Trump has signed an executive order paving the way for the inclusion of higher-risk assets — such as private equity, cryptocurrencies, and real estate — in U.S. 401(k) retirement plans.

However, federal agencies must first amend regulations, a process that could take months or even years before employers can offer such options. Still, the move is seen as a major victory for the $5 trillion private equity sector and the cryptocurrency industry, both of which supported Trump’s campaign.

Following the announcement, cryptocurrency prices surged sharply — Ethereum jumped to $3,900, Bitcoin hit $116,600, and altcoins also posted strong gains.