Morning Wrap (29.07.2025)

The Asian session is unfolding calmly, with no major data releases and narrow trading ranges in both currency and equity markets. Movements in stock indices are limited to +/-0.50%.

U.S. Commerce Secretary Lutnick suggested that a 90-day extension of the tariff truce with China is highly likely. Talks began Monday in Stockholm and are expected to continue Tuesday.

Trump blocked a transit stopover in New York by Taiwan’s president to avoid antagonizing China — signaling a desire to maintain diplomatic balance with Beijing.

Nvidia has ordered 300,000 H20 chips from TSMC to meet strong demand from China. However, the U.S. Commerce Department has not yet approved the necessary export licenses.

A former Bank of Japan policymaker said further rate hikes are needed to align inflation forecasts with economic realities. Rising food prices could push inflation expectations above the BoJ’s target.

The U.S. Treasury Department announced it will borrow $1.007 trillion in Q3 — significantly more than the $554 billion forecast in April. The extended debt ceiling allows for greater issuance, particularly of Treasury bills.

Fidelity International forecasts that gold prices could rise to $4,000 per ounce by the end of 2026, supported by Fed policy easing, a weaker dollar, and strong central bank demand.

Morgan Stanley predicts the US500 index will rise to 7,200 points, driven by improved margins and profit growth. Key drivers include AI adoption, a weaker dollar, and tax benefits from Trump’s “One Big Beautiful Bill” plan.

Trump has shortened his Ukraine peace ultimatum from 50 to 12 days, expressing frustration over the lack of progress. Along with UK Prime Minister Starmer, he reiterated threats of 100% tariffs and secondary sanctions, targeting countries still trading with Russia — including China and India.

Ray Dalio suggested that long-term portfolios should include 15% exposure to gold or Bitcoin. While he prefers gold, he supports both assets as hedges against currency devaluation and fiscal instability.