[Macro Matters] 5/11 Weekly Breifing
1. Economic Data
How Bad Is China’s Economy? The Data Needed to Answer Is Vanishing - WSJ
Chinese officials stopped publishing economic indicators such as land sales measures,
foreign investment data and unemployment indicators.
US services sector expands with hints of rising price pressures | Reuters
Services sector PMI increased 0.8 point to 51.6 in April.
US trade deficit swells to record high amid rush to beat tariffs in March | Reuters
Trade deficit widens 14.0% to record high as companies increase imports of goods ahead of tariffs.
Imports from China were the lowest in 5 years as duties on Chinese goods were in place in
early April.
Chinese Trade Flow Resilient at End of April Despite US Tariffs - Bloomberg
China’s trade flows increased at the end of April even as the US reduced imports of Chinese
products.
China Services Activity Slips, Adding Risk of Rapid Slowdown
China’s services activity deteriorated more than expected in April.
Eurozone Shoppers Spend Less as Tariffs Weigh on Mood - WSJ
Retail sales ↓ 1%
Goldman Boosts Forecast for US Inflation as Dollar Slides
US Consumer Borrowing Rises Most in Three Months in Broad Pickup - Bloomberg
US consumer borrowing increased in March. Despite anxieties on economic outlook,
US consumers keep spending.
US Jobless Claims Drop After Brief Spike During Spring Recess - Bloomberg
Initial claims decreased by 13,000 to 228,000 in the week ended May 3.
The labor market remains solid despite concerns over tariffs.
2. Central Bank
Taiwan president calls for end to 'false' news about US forex talks | Reuters
Taiwan's president has repeatedly stated that there were no conversations about the exchange rate.
Taiwan’s Central Bank Warns on Currency Comments - Bloomberg
Taiwan’s central bank warned investors on currency and urged commentators to stop speculating
about the FX market after it intervened in currency markets to
smooth the Taiwan dollar’s appreciation and failed to smooth it out by “excessively strong”
market expectations.
China Cuts Key Rate, Reserve Ratio to Aid Economy Hit by Tariffs - Bloomberg
The People’s Bank of China cut the seven-day reverse repurchase rate to 1.4% from 1.5%
Exclusive: Ukraine considers shift from dollar to euro amid geopolitical realignments | Reuters
Ukraine’s central bank governor told Reuters that the bank is considering using euros as
the reference instead of the U.S. dollars.
Fed Warns of Rising Economic Risks as It Leaves Rates Steady - WSJ
Powell: “If the large increases in tariffs that have been announced are sustained, they’re
likely to generate a rise in inflation, a slowdown in economic growth, and an increase in
unemployment”
Fed Statement:
Pointed out increase in net exports
Expressed concerns over possibility of higher unemployment and inflation risk due to tariffs.
The decision was unanimous.
Korea’s Forex Reserves Hit Five-Year Low on Pension Fund Swaps - Bloomberg
Trump Slams Fed Chair Powell Again for Keeping Rates Steady - Bloomberg
“‘Too Late’ Jerome Powell is a FOOL, who doesn’t have a clue. … virtually NO INFLATION
Trump posted.
Bank of England cuts rates to 4.25% as it sees tariff hit to growth | Reuters
ECB’s Simkus Says More Cuts Needed as US Tariffs Weigh on Growth - Bloomberg
ECB’s Simkus says that ECB needs to lower interest rates in advance before Europe's economy faces
the full force of trade tensions.
ECB should keep steady hand, hold rates close to current levels, Schnabel says | Reuters
ECB board member Isabel Schnabel claimed that ECB should stop cutting interest rates as trade
conflicts might spur inflation.
3. Politics / World
Kim Jong Un’s Latest Gift to Russia Is Migrant Workers - WSJ
North Korea has sent 15,000 workers to Russia, according to South Korea’s spy agency.
Trump Says ‘I Don’t Know’ When Asked if He Must Uphold the Constitution - WSJ
???
Israeli cabinet approves expansion of Gaza offensive, broadcaster Kan reports | Reuters
Israel starts a more ‘intensive’ offensive to fully occupy Gaza unless all the goals are satisfied.
The blockade on aid remains for now.
Trump posts AI-generated photo of himself as pope, drawing internet outrage | Reuters
Catholic bishops of New York and even some Republicans showed fierce rage over the photo.
Pakistan Says India Chokes River Flow as Fears of Conflict Rise - Bloomberg
Pakistan alleged that India has almost entirely stopped the flow of water across the border.
EU Set to Propose Banning Russian Gas Imports by End of 2027 - Bloomberg
China's Xi ready to work with EU to expand ties, handle friction | Reuters
China is ready to forge economic and political links with the EU.
India strikes Pakistan over Kashmir tourist killings | Reuters
India and Pakistan exchanged heavy gunfire. Crucial treaties such as the Indus Water Treaty and
trades are all paused.
Conservative Merz elected German chancellor after initial debacle | Reuters
Putin and Netanyahu discuss Middle East, bilateral ties in phone call, Kremlin says | Reuters
US House Is Likely to Kill EV Tax Credit, Speaker Johnson Says - Bloomberg
Republicans in the US House are likely to kill the consumer tax credit for electric vehicles,
according to Speaker Mike Johnson.
Xi Visits Moscow to Strengthen China-Russia Ties Amid US Trade War - Bloomberg
In 2024, the regular defence budget was 52 billion euros. The German defense minister wants to
keep spending 60 billion euros every year for four years.
Syria has had indirect talks with Israel to calm situation, Syrian leader says | Reuters
'Friends of steel': Xi and Putin pledge to stand together against US | Reuters
Hamas says it is engaged in 'fierce fighting' in Gaza's Rafah | Reuters
US imposes Iran-related sanctions on third China 'teapot' refinery, ports | Reuters
Trump Brings Millionaire Tax Idea Back to Life
The president, who rejected a “millionaire tax” April 23, is now considering backing a tax structure
that would return the top individual income-tax rate to 39.6% from 37% for people making over
$2.5 million, according to people familiar with White House discussions.
Germany's Merz does not rule out EU defence borrowing | Reuters
India and Pakistan agree to an immediate ceasefire | Reuters
Violations reported after India and Pakistan agree to ceasefire | Reuters
Trump announced that India and Pakistan agreed to a full and immediate ceasefire. Despite the
truce, a number of violations by both sides were reported.
Xi Jinping glorifies hard work, but the young are not so sure
While fighting America, Mr Xi may struggle to defeat cynicism at home.
A glimpse inside Putin’s secret arms empire | The Economist
The Economist reports numerous indicators that Russia is manufacturing arms “at an
unprecedented pace”
4. Business / Market / Trade
Berkshire’s (BRK/A) Warren Buffett Says Trade Can Be an ‘Act of War’ - Bloomberg
Warren Buffett stated that trade policies should not be a weapon at his last annual meeting
in Ohama.
Trump Calls for 100% Tariff on Movies Made Overseas - WSJ
Trump to impose 100% tariffs on movies produced overseas. Hollywood executives did not
receive any information in advance.
Japan says no plan to threaten Treasuries sale in US trade talks | Reuters
Finance minister of Japan stated that Japan has no plans to sell US Treasuries to gain leverage
in trade negotiations.
Trump says would extend TikTok deadline if no deal reached by June 19 | Reuters
Companies Piled Up Commercial Paper in April to Bolster Cash - Bloomberg
Short-term debt issued by corporations surged in April due to concerns on uncertainty.
India Offers Zero-for-Zero Tariffs on Auto Parts, Steel From US - Bloomberg
Bessent Touts US as ‘Premier Destination’ for Global Capital - Bloomberg
“The United States is the premier destination for international capital,” Bessent said.
The aim is to return to the non-inflationary growth, he said. Bessent showed confidence in Treasury
interest rates and economic prosperity.
Foxconn says April revenue rose 25.54% y/y, sees Q2 growth | Reuters
Chipmaker Onsemi forecasts upbeat quarterly revenue on resilient demand from EV makers | Reuters
Exclusive: US lawmaker targets Nvidia chip smuggling to China with new bill | Reuters
Bipartisan US lawmakers plan to make a new law to track the after-sale of NVIDIA chips.
The technology to verify the location of chips already exists, according to people familiar with
the matter.
Google has launched new film and TV production wing, Business Insider reports | Reuters
Google has launched a new film and TV production initiative, Business Insider reported.
UnitedHealth Now Has 1,000 AI Use Cases, Including in Claims - WSJ
U.S. seeks breakup of Google's ad-tech products after judge finds illegal monopoly | Reuters
The U.S. Department of Justice has proposed that Google sell its AdX digital ad marketplace and
DFP platform after a judge found that Google held an illegal monopoly.
Palantir shares dive after quarterly results fail to impress investors | Reuters
Tesla's UK, Germany new car sales at two-year low in April even as EV demand rises | Reuters
Tesla’s new car sales in the UK and Germany dropped to their lowest in two years even if
total EV sales surged in those countries.
OpenAI dials back conversion plan, nonprofit to retain control | Reuters
Ethereum’s Latest Upgrade Is Seen Doing Little to Bolster Price (ETH) - Bloomberg
Upcoming Etheruem’s Pectra update aims to reduce transaction costs and traffic. Also the upgrade
will change how users ‘stake’ their coins and smart contract functionality.
Although the update is right on track, changes may not be sufficient to outpace rivals.
Copper Shrugs Off Global Gloom as Chinese Buyers Squeeze Supply
The global copper market is experiencing tightness due to strong Chinese buying as I introduced
before.
US-China Trade Talks to Start This Week Focused on De-Escalation
Bessent visits Geneva to start conversations on trade with China. Bessent stated that the ongoing
tariff rates are unsustainable and he wants a fair deal, not a decoupling.
Nvidia CEO Says China AI Market Is on Course to Hit $50 Billion (NVDA) - Bloomberg
Huang: “Let us go after it and win it.”
AMD Gives Strong Earnings Forecast in Sign It’s Gaining AI Market Share - Bloomberg
Hyundai Unveils First China Electric SUV to Take on Competition - Bloomberg
The first electric SUV that targets the Chinese market was developed with local partner, BAIC.
EU to Hit Boeing, US Cars With Tariffs If Trade Talks Fail - Bloomberg
Exclusive: Ford hikes prices on Mexico-produced models, citing tariffs | Reuters
HSBC launches Trump tariff payment process for US clients | Reuters
HSBC has launched a new financing tool for U.S. clients to pay import duties following
the imposition of sweeping tariffs
Cisco Systems Introduces New Quantum Chip, Opens Lab Facility - WSJ
Cisco Systems stated that it created a brand-new quantum chip that consumes less than
1 milliwatt of power. Also, it opened a quantum lab to research quantum technologies.
China Weighs Housing Market Overhaul to Curb Pre-Sales - Bloomberg
China is considering barring the pre-sales model on properties, according to people familiar
with the matter.
China Reiterates US Should Cancel Tariffs Ahead of Trade Talks - Bloomberg
Beijing reiterated its call for the US to cancel unilateral tariffs on China
BP-Shell Megadeal Would Create European Rival to Exxon Mobil - Bloomberg
Several newspapers report that Shell is considering acquiring BP.
Combining the two London-based oil majors would create an energy giant with upstream oil and
gas production of nearly 5 million barrels of oil equivalent a day, making the combined company
the largest investor-owned oil and gas producer.
Apple Eyes Move to AI Search, Ending Era Defined by Google
Apple is considering revamping Safari to focus on AI-powered search engines. Apple's senior vice
president of services mentioned that Apple had discussions with several AI providers
including OpenAI, perplexity etc.
U.S. Crude Oil Stockpiles Fall Amid Lower Production - WSJ
U.S. crude oil inventories fell for a second straight week as production declined.
China's Huawei to launch first laptop with self-developed Harmony operating system | Reuters
TSMC April Sales Surge After US Tariffs Spur Device Rush Orders - Bloomberg
'Genshin Impact' Creator Dives Into AI for Growth Beyond Games - Bloomberg
As HoYoverse’s recent titles begin to cannibalize each other, the company is now shifting its focus
to develop new games with more diverse genres by using AI on development.
Ahead of China-US talks, Trump says 80% tariff 'seems right' - Reuters
U.S. President Donald Trump said on Friday an 80% tariff on Chinese goods "seems right”.
Trump won’t lower tariffs against China in advance, White House spokeswoman highscored.
US senator introduces bill calling for location-tracking on AI chips to limit China access | Reuters
A U.S. senator introduced a bill on Friday that would direct the Commerce Department to require
location verification mechanisms for export-controlled AI chips.
Microsoft doesn't allow its employees to use China's Deepseek-President | Reuters
Exclusive: Nvidia modifies H20 chip for China to overcome US export controls, sources say | Reuters
Nvidia plans to release a downgraded version of its H20 for China in the next two months,
according to the people familiar with the matter.
US and Chinese officials pursue Geneva talks on easing trade war | Reuters
U.S. President Donald Trump hailed talks with China in Switzerland on Saturday,
saying the two sides had negotiated "a total reset ... in a friendly, but constructive, manner."
Huawei and other Chinese chip firms are catching up fast
Huawei’s new CloudMatrix chip cluster might beat NVIDIA’s popular NVL72 cluster,
though it consumes more energy. China’s tech companies also aim to produce HBM,
chip-making equipment by themselves. Yet, they cannot manufacture ‘high-tech’ chips and
replace the CUDA platform from NVIDIA for now.
Donald Trump is right to ditch Joe Biden’s chip-export rules
The article claims that export controls on chips can work only if they are narrowly applied.
For instance, the restrictions on EUV machines which are made only by ASML worked successfully.
Instead of complicated rule-based restrictions, Trump should adopt simpler regulations to be more
effective, the Economist’s reporter asserts.
Buy the dip: the trend that keeps stocks from crashing
The Economist points out that the stock market could be stabilized thanks to amateur investors
regularly piling into the market on its most difficult days.
5. Indices & Commodities
The market's expectation for easing trade tensions prompted investors to shift toward riskier assets rather than treasuries. Investors also avoided US treasuries as the labor market remains solid despite concerns over tariffs and inflation expectations.
Coinbase Strikes $2.9 Billion Deal for Major Crypto Options Platform - WSJ
Coinbase Global has agreed to acquire Deribit, the world’s biggest trading platform for bitcoin and
ether options. The deal would be the biggest in crypto history.
SEC Seeks to Settle Legal Fight With Ripple Labs for $50 Million - Bloomberg
SEC to end the case over Ripple.
Positive news and NASDAQ gains fueled a Bitcoin surge.
The market's expectation for easing trade tensions prompted investors to shift toward riskier assets rather than treasuries and gold. High interest rates also restrained bullish sentiment toward gold.
Big Oil Isn’t Budging on Output as OPEC+ Supply Hike Looms - Bloomberg
Major western oil companies maintained their capital spending plans despite a 16% drop in
crude oil price and OPEC+’s decision to increase supply.
Saudis Hike Oil Prices to Asia Despite More OPEC+ Supply - Bloomberg
State producer Saudi Aramco raised the prices of all crude oil for Asia. It lowered prices for
other regions.
Oil Gains From Four-Year Low on Signs US Output Is Set to Fall
The US cuts its forecast for domestic oil production this year => Oil gains.
Despite the supply increase in crude oil, prices rose from four-year low as the US cuts its forecast
for domestic oil production this year, and the inventories in the US were lower than expacted.
6. Opinion
Since my stance and thoughts remain largely unchanged from what I wrote last week, I decided to skip this week’s Summary & Opinion.
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