<ul><li><a href="https://investinglive.com/centralbank/pboc-governor-pan-gongsheng-signals-slower-credit-growth-and-offshore-fx-push-20260617/">PBOC governor Pan Gongsheng signals slower credit growth and offshore FX push</a></li><li><a href="https://investinglive.com/news/china-to-issue-cny-300bln-bonds-to-boost-bank-capital-as-local-debt-tackled-20260617/">China to issue CNY 300bln bonds to boost bank capital as local debt tackled</a></li><li><a href="https://investinglive.com/commodities/goldman-holds-ttf-gas-forecasts-flags-upside-risk-and-delayed-lng-recovery-20260617/">Goldman holds TTF gas forecasts, flags upside risk and delayed LNG recovery</a></li><li><a href="https://investinglive.com/news/china-financial-regulator-vows-to-tackle-property-local-debt-and-small-bank-risks-20260617/">China financial regulator vows to tackle property, local debt and small bank risks</a></li><li><a href="https://investinglive.com/commodities/us-defense-production-act-floated-to-force-us-insurer-to-cover-hormuz-passage-navy-escort-20260617/">US Defense Production Act floated to force US insurer to cover Hormuz passage, Navy escort</a></li><li><a href="https://investinglive.com/centralbank/pboc-sets-usd-cny-mid-point-today-at-68096-vs-estimate-at-67569-20260617/">PBOC sets USD/ CNY mid-point today at 6.8096 (vs. estimate at 6.7569)</a></li><li><a href="https://investinglive.com/centralbank/japan-exports-beat-forecasts-in-may-at-fastest-pace-since-late-2022-20260617/">Japan exports beat forecasts in May at fastest pace since late 2022</a></li><li><a href="https://investinglive.com/news/singapore-may-exports-surge-384-biggest-jump-in-20-years-on-ai-demand-20260617/">Singapore May exports surge 38.4%, biggest jump in 20 years on AI demand</a></li><li><a href="https://investinglive.com/news/japan-april-core-machinery-orders-surge-exports-beat-also-20260616/">Japan April core machinery orders surge, exports beat also</a></li><li><a href="https://investinglive.com/stocks/openai-burned-37-billion-in-first-quarter-of-2026-20260616/">"OpenAI burned $3.7 billion in first quarter of 2026"</a></li><li><a href="https://investinglive.com/centralbank/one-more-ecb-hike-seen-in-september-before-rates-plateau-through-2027-20260616/">One more ECB hike seen in September before rates plateau through 2027</a></li><li><a href="https://investinglive.com/news/japan-business-sentiment-rises-in-june-on-semiconductor-demand-reuters-tankan-20260616/">Japan business sentiment rises in June on semiconductor demand, Reuters Tankan</a></li><li><a href="https://investinglive.com/news/chinese-export-flood-puts-eu-tariff-wall-firmly-on-g7-agenda-in-france-20260616/">Chinese export flood puts EU tariff wall firmly on G7 agenda in France</a></li><li><a href="https://investinglive.com/news/new-zealand-q1-current-account-deficit-narrows-sharply-on-quarterly-basis-20260616/">New Zealand Q1 current account deficit narrows sharply on quarterly basis</a></li><li><a href="https://investinglive.com/commodities/us-iran-deal-where-things-stand-and-what-comes-next-20260616/">US-Iran deal: where things stand and what comes next</a></li><li><a href="https://investinglive.com/centralbank/yen-stays-weak-after-boj-hike-as-analysts-eye-intervention-risk-20260616/">Yen stays weak after BoJ hike as analysts eye intervention risk</a></li><li><a href="https://investinglive.com/centralbank/new-zealand-consumer-confidence-drops-to-lowest-since-2023-survey-shows-20260616/">New Zealand consumer confidence drops to lowest since 2023, survey shows</a></li><li><a href="https://investinglive.com/news/investinglive-americas-market-news-wrap-oil-continues-to-fall-in-the-lead-up-to-the-fomc-20260616/">investingLive Americas market news wrap: Oil continues to fall in the lead-up to the FOMC</a></li><li><a href="https://investinglive.com/commodities/oil-private-inventory-survey-shows-a-headline-crude-oil-draw-much-greater-than-expected-20260616/">Oil: Private inventory survey shows a headline crude oil draw much greater than expected</a></li><li><a href="https://investinglive.com/centralbank/rba-holds-rates-at-435-signals-further-hikes-still-possible-recap-20260616/">RBA holds rates at 4.35%, signals further hikes still possible - recap</a></li><li><a href="https://investinglive.com/stocks/broader-us-indices-close-near-lows-dow-industrial-average-closes-higher-20260616/">Broader US indices close near lows. Dow industrial average closes higher.</a></li></ul><p>Summary:</p><ul class="[li_&amp;]:mb-0 [li_&amp;]:mt-1 [li_&amp;]:gap-1 [&amp;:not(:last-child)_ul]:pb-1 [&amp;:not(:last-child)_ol]:pb-1 list-disc flex flex-col gap-1 pl-8 mb-3"><li class="font-claude-response-body whitespace-normal break-words pl-2">US weighing naval escorts and insurance mandates to unblock nearly 500 stranded tankers at Hormuz despite MOU signing; oil prices lower on supply return expectations</li><li class="font-claude-response-body whitespace-normal break-words pl-2">New Zealand consumer confidence hit a two-year low of 80.4 in Q2; Q1 current account deficit narrowed sharply to NZ$1.008B from NZ$5.984B prior</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Japan Reuters Tankan: manufacturers +13 from +8, non-manufacturers +32 from +29; Nikkei clawed back losses to print a fresh all-time high near 70,000</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Singapore NODX surged 38.4% in May, a 20-year high, on AI electronics demand; US 12.5% tariff proposal clouds the outlook</li><li class="font-claude-response-body whitespace-normal break-words pl-2">China vice premier announced CNY 300bln special bond issue to recapitalise banks and pledged vigorous local government debt resolution; PBOC governor Pan Gongsheng signalled credit growth will not return to its previous pace and laid groundwork for further yuan internationalisation</li><li class="font-claude-response-body whitespace-normal break-words pl-2">OpenAI burned through $3.7bln in Q1 2026, more than half its $5.7bln in revenue, per Reuters citing The Information; confidential IPO prospectus filed last week with a suspected September debut</li><li class="font-claude-response-body whitespace-normal break-words pl-2">FX markets subdued ahead of the FOMC; Chinese equities lagged with the Hang Seng -0.7% and Shanghai Comp -0.2% as auto and aluminium names weighed and markets shrugged off reports the US delayed blacklisting DeepSeek and over 100 Chinese firms</li></ul><p class="font-claude-response-body break-words whitespace-normal">Markets drifted towards the North American session in a holding pattern, with the Federal Open Market Committee decision the dominant event risk and traders reluctant to extend positions ahead of new Fed Chair Kevin Warsh's first major policy test at the podium.</p><p class="font-claude-response-body break-words whitespace-normal">The Hormuz supply picture remained the key macro overhang for energy markets. Oil prices traded lower as the US-Iran interim peace deal continued to price in a gradual return of supply, though the physical reality remains complicated: nearly 500 vessels including 220 oil tankers are sitting anchored outside the strait, unable to move while insurance markets remain effectively closed to Hormuz transits. The Trump administration is now weighing fee-based naval escorts and potential use of the Defense Production Act to compel US insurers to provide coverage, with the White House under pressure to translate the MOU into actual barrel flows.</p><p class="font-claude-response-body break-words whitespace-normal">Out of the Asia-Pacific session, the data run was broadly constructive. Japan's Reuters Tankan showed two consecutive months of improving manufacturer sentiment, Singapore delivered its strongest export print in two decades on AI-driven chip demand, and New Zealand's current account deficit narrowed sharply on a quarterly basis. The softer note came from New Zealand consumer confidence, which fell to its lowest reading since 2023 as war-related fuel costs and borrowing pressures bit into household sentiment.</p><p class="font-claude-response-body break-words whitespace-normal">China generated significant headline flow. The vice premier's CNY 300 billion special bond announcement to recapitalise financial institutions, paired with a pledge to vigorously resolve local government debt, represented the most concrete fiscal commitment in some time. PBOC governor Pan Gongsheng followed with a frank assessment that sustaining China's previous pace of credit growth is neither achievable nor desirable, while also advancing the groundwork for broader yuan internationalisation through new offshore FX and bond market steps in Shanghai.</p><p class="font-claude-response-body break-words whitespace-normal">In equities, Japan's Nikkei 225 was the standout, taking back early losses to print a fresh all-time high. Chinese markets lagged, with the Hang Seng off 0.7% and the Shanghai Composite down 0.2%. Report that the US had delayed blacklisting DeepSeek and over 100 Chinese firms failed to lift sentiment.</p><p class="font-claude-response-body break-words whitespace-normal">Away from macro, OpenAI's finances came into focus after Reuters, citing The Information, reported the company burned through $3.7 billion in the first quarter of 2026, more than half its $5.7 billion in revenue. The disclosure follows last week's filing of a confidential IPO prospectus, with a market debut suspected for September.</p> This article was written by Eamonn Sheridan at investinglive.com.

<p class="font-claude-response-body break-words whitespace-normal"> The CNY 300 billion special bond announcement is the most market-concrete element of the statement and signals Beijing is moving from acknowledging bank capital stress to actively addressing it. Chinese bank stocks, particularly mid-tier and regional lenders most exposed to local government financing vehicles, may find near-term support on the recapitalisation signal. The explicit commitment to vigorously and orderly advancing local government debt resolution, paired with the capital injection, suggests a coordinated approach to two problems that have historically been treated separately. The defiant tone on external suppression adds a geopolitical undertone that could weigh on sentiment around China-exposed assets if read as signalling an escalatory posture, though markets will likely focus on the fiscal stimulus dimension first.</p><p class="font-claude-response-body break-words whitespace-normal">--- China's vice premier pledged to issue CNY 300 billion in special bonds to recapitalise financial institutions and vigorously advance local government debt resolution, alongside plans to open the financial sector further.</p><p class="font-claude-response-body break-words whitespace-normal">Summary:</p><ul class="[li_&amp;]:mb-0 [li_&amp;]:mt-1 [li_&amp;]:gap-1 [&amp;:not(:last-child)_ul]:pb-1 [&amp;:not(:last-child)_ol]:pb-1 list-disc flex flex-col gap-1 pl-8 mb-3"><li class="font-claude-response-body whitespace-normal break-words pl-2">China will issue CNY 300 billion in special bonds to replenish the capital of financial institutions, the vice premier announced</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Beijing pledged to vigorously and orderly advance the resolution of local government debt, one of the most persistent pressure points in China's financial system</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Additional commitments included stepping up financial supervision, further opening the financial sector, and establishing an offshore financial market system in Shanghai</li><li class="font-claude-response-body whitespace-normal break-words pl-2">The vice premier said China will never compromise or back down in the face of external suppression, and will safeguard national financial security in accordance with law</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Accelerating the development of marine insurance business was also flagged, potentially relevant to shipping recovery in the wake of the Hormuz disruption</li></ul><p class="font-claude-response-body break-words whitespace-normal"> China's vice premier has announced a CNY 300 billion special bond issuance to recapitalise financial institutions and pledged a vigorous push to resolve local government debt, in the most direct official acknowledgement yet that Beijing is prepared to deploy substantial fiscal resources to stabilise its financial system.</p><p class="font-claude-response-body break-words whitespace-normal">The bond announcement addresses a pressure point that regulators and analysts have flagged repeatedly: Chinese banks, particularly smaller regional lenders with heavy exposure to local government financing vehicles, have faced mounting capital adequacy concerns as the property sector downturn and local government debt stress have eroded asset quality. The special bond mechanism channels central government resources into the banking system without requiring institutions to raise capital from markets that remain wary of the sector's underlying risks.</p><p class="font-claude-response-body break-words whitespace-normal">The commitment to vigorously and orderly advance local government debt resolution signals an acceleration of a process that has moved unevenly since Beijing first acknowledged the scale of the problem. The pairing of a capital injection with a debt resolution pledge is significant: it suggests policymakers are trying to address both sides of a feedback loop in which local government default risk weakens the banks holding that debt, which in turn limits the financial system's capacity to support broader economic activity.</p><p class="font-claude-response-body break-words whitespace-normal">Beyond the two headline measures, the vice premier outlined a broader financial agenda. Further opening of the financial sector was pledged alongside plans to establish an offshore financial market system in Shanghai, a long-discussed ambition that would expand the city's role as an international financial centre. Accelerating the development of marine insurance business was also flagged, a detail that carries additional resonance given the ongoing challenges in restoring normal shipping flows through the Strait of Hormuz.</p><p class="font-claude-response-body break-words whitespace-normal">The vice premier also struck a combative note on external pressure, stating China would never compromise or back down in the face of suppression, a signal directed at trading partners and geopolitical rivals rather than domestic audiences.</p> This article was written by Eamonn Sheridan at investinglive.com.

<p class="font-claude-response-body break-words whitespace-normal">The breadth of the regulator's statements, spanning real estate, local government debt, small financial institutions and illegal activity in a single release, signals Beijing remains acutely aware of the interlocking vulnerabilities in its financial system. Explicit mention of real estate and local government debt in the same breath as systemic risk prevention will be read as an acknowledgement that neither problem has been resolved, keeping pressure on Chinese bank stocks and property sector credit. The pledge to guide capital toward emerging and future industries suggests a continued policy tilt away from the old-economy sectors that have dominated Chinese finance for decades, with implications for sector allocation within China-exposed portfolios.</p><p class="font-claude-response-body break-words whitespace-normal">---</p><p class="font-claude-response-body break-words whitespace-normal">Be good to tackle indeed:</p><ul><li><a href="https://investinglive.com/news/china-house-prices-may-2026-35-yy-prior-35-20260616/" target="_blank" rel="follow" data-article-link="true">China house prices May 2026 -3.5% y/y (prior -3.5%)</a></li></ul><p class="font-claude-response-body break-words whitespace-normal">--- China's financial regulator pledged to prevent systemic risks, resolve real estate and local government debt exposures, and crack down on illegal activity and disorderly competition in the financial sector. </p><p class="font-claude-response-body break-words whitespace-normal">Summary:</p><ul class="[li_&amp;]:mb-0 [li_&amp;]:mt-1 [li_&amp;]:gap-1 [&amp;:not(:last-child)_ul]:pb-1 [&amp;:not(:last-child)_ol]:pb-1 list-disc flex flex-col gap-1 pl-8 mb-3"><li class="font-claude-response-body whitespace-normal break-words pl-2">The regulator pledged to prevent systemic financial risks and resolve exposures in real estate and local government debt, two of the most persistent stress points in China's financial system</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Small financial institutions were flagged twice: the regulator committed to preventing risks from smaller lenders while also pledging to steadily improve their quality</li><li class="font-claude-response-body whitespace-normal break-words pl-2">A crackdown on illegal financial activities and disorderly competition was announced alongside pledges to step up regulatory cooperation in emerging areas</li><li class="font-claude-response-body whitespace-normal break-words pl-2">The regulator said it will guide financial resources toward emerging and future industries, reinforcing Beijing's broader policy push to reorient capital away from legacy sectors</li></ul><p class="font-claude-response-body break-words whitespace-normal"> China's top financial regulator issued a broad set of policy commitments on Tuesday, pledging to contain systemic risk, address longstanding vulnerabilities in real estate and local government finance, and strengthen oversight of smaller financial institutions, while directing capital toward emerging industries.</p><p class="font-claude-response-body break-words whitespace-normal">The National Financial Regulatory Administration set out a wide-ranging agenda that touched on virtually every pressure point in the Chinese financial system. Real estate and local government debt were explicitly named as risk areas requiring resolution, a candid acknowledgement of two problems that have weighed on investor confidence in Chinese financial markets for several years and have repeatedly required policy intervention to prevent broader contagion.</p><p class="font-claude-response-body break-words whitespace-normal">Small financial institutions featured prominently in the statement, with the regulator committing both to preventing risks emanating from that segment of the sector and to improving the overall quality of smaller lenders. The dual framing reflects the challenge Beijing faces: smaller banks remain important conduits for local credit but carry disproportionate asset quality risk relative to the large state-owned institutions that dominate the system.</p><p class="font-claude-response-body break-words whitespace-normal">The regulator also pledged to crack down on illegal financial activities and disorderly competition, language that signals continued scrutiny of behaviour in lending, wealth management and fintech that falls outside or on the edges of official rules. Regulatory cooperation in emerging areas was flagged as a priority, pointing to growing attention on newer financial products and platforms that have expanded faster than oversight frameworks.</p><p class="font-claude-response-body break-words whitespace-normal">On the capital allocation side, the regulator said it would guide financial resources toward emerging and future industries, consistent with Beijing's broader industrial policy ambitions and its push to reduce the economy's reliance on property and infrastructure investment as growth drivers.</p><p class="font-claude-response-body break-words whitespace-normal">The statement did not include specific targets or timelines, but its scope and the simultaneous release of multiple headlines underscored the regulatory establishment's intent to signal active management of financial stability risks at a sensitive moment for the Chinese economy. </p> This article was written by Eamonn Sheridan at investinglive.com.

<p class="font-claude-response-body break-words whitespace-normal"> The scale of the beat, nearly 7 percentage points above consensus, underscores how concentrated Singapore's export boom is in AI-driven electronics, with integrated circuits, disk media and PCs doing the heavy lifting. The 303% surge in electronics exports to the US and 218% to Taiwan highlights the semiconductor supply chain intensity of the move and raises questions about sustainability if US tariff proposals proceed. A 12.5% additional levy on Singaporean goods, if enacted, could affect around a third of the city-state's direct US exports, introducing a meaningful headwind to what is otherwise the strongest export print in two decades. The SGD and Singapore equities with electronics exposure will be sensitive to any escalation in the tariff dispute.</p><p class="font-claude-response-body break-words whitespace-normal"> Singapore's non-oil domestic exports surged 38.4% in May</p><ul><li>expected +31.1%. prior +24.5%</li></ul><p class="font-claude-response-body break-words whitespace-normal">the largest annual rise in 20 years, driven by AI-related electronics demand, though a proposed US 12.5% tariff threatens a third of direct US shipments. </p><p class="font-claude-response-body break-words whitespace-normal">Summary:</p><ul class="[li_&amp;]:mb-0 [li_&amp;]:mt-1 [li_&amp;]:gap-1 [&amp;:not(:last-child)_ul]:pb-1 [&amp;:not(:last-child)_ol]:pb-1 list-disc flex flex-col gap-1 pl-8 mb-3"><li class="font-claude-response-body whitespace-normal break-words pl-2">Singapore's non-oil domestic exports rose 38.4% year-on-year in May, well above the Reuters poll median of 31.1% and the largest annual increase in at least 20 years</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Electronics drove the gain, with AI-related demand boosting integrated circuits, disk media products and PCs</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Exports of electronics to the US surged 303% annually, while shipments to Taiwan rose 218.6%; exports to Indonesia declined</li><li class="font-claude-response-body whitespace-normal break-words pl-2">The US Trade Representative in June accused Singapore among 60 countries of inadequate enforcement against forced labour trade and proposed additional tariffs of 12.5% on Singaporean exports</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Singapore's trade ministry denied the forced labour assertion and noted roughly a third of the country's direct US exports could be affected if the proposed tariffs proceed</li></ul><p class="font-claude-response-body break-words whitespace-normal"> Singapore's non-oil domestic exports posted their largest annual increase in at least two decades in May, surging 38.4% from a year earlier as artificial intelligence-driven demand for semiconductors and related electronics propelled shipments well beyond market expectations.</p><p class="font-claude-response-body break-words whitespace-normal">The result exceeded the median forecast of 31.1% growth in a Reuters poll by a considerable margin, with Enterprise Singapore data showing electronics at the centre of the advance. Integrated circuits, disk media products and personal computers all contributed, reflecting sustained capital investment in AI infrastructure by technology firms in Singapore's key export markets.</p><p class="font-claude-response-body break-words whitespace-normal">The destination breakdown highlighted the concentration of demand. Electronics exports to the United States climbed 303% on an annual basis, while shipments to Taiwan, a critical node in the global semiconductor supply chain, rose 218.6%. Exports to China also increased, while shipments to Indonesia declined from year-earlier levels.</p><p class="font-claude-response-body break-words whitespace-normal">The record reading arrives against a complicated trade backdrop. In June, the US Trade Representative identified Singapore among 60 countries it accused of insufficient action against trade in goods produced with forced labour, and proposed additional tariffs of 12.5% on Singaporean exports to the United States. Singapore's trade ministry rejected the characterisation, stating the city-state actively enforces against such practices domestically. It nonetheless acknowledged that approximately a third of Singapore's direct US exports could be exposed to the proposed levies if they are enacted.</p><p class="font-claude-response-body break-words whitespace-normal">The juxtaposition of a historic export surge and a fresh tariff threat captures the tension facing Singapore's trade-dependent economy. AI demand has delivered an exceptional windfall for the electronics sector, but the US remains both its most valuable destination market and the source of its most immediate policy risk. How Washington proceeds on the tariff proposal will be closely watched by exporters and policymakers alike.</p> This article was written by Eamonn Sheridan at investinglive.com.

<p class="font-claude-response-body break-words whitespace-normal">Japan April core machinery orders +8.7% m/m</p><ul><li> exp +0.9%, prev -9.4%</li></ul><p class="font-claude-response-body break-words whitespace-normal">+15.6% y/y</p><ul><li> exp +9.3%, prev +5.9%</li></ul><p class="font-claude-response-body break-words whitespace-normal">Japan May trade balance -¥378.7B</p><ul><li> exp -¥564.6B, prev +¥301.9B</li></ul><p class="font-claude-response-body break-words whitespace-normal">Japan May exports +17.0% y/y</p><ul><li> exp +16.2%, prev +14.8%</li></ul><p class="font-claude-response-body break-words whitespace-normal">To EU +14.5% y/y — to Asia +19.5% y/y — to US +12.5% y/y — to China +17.9% y/y</p><p class="font-claude-response-body break-words whitespace-normal">Japan May imports +12.5% y/y</p><ul><li> exp +12.8%, prev +9.7%</li></ul><p>I'll have more to come on this separately ... here we are, ADDED: <a href="https://investinglive.com/centralbank/japan-exports-beat-forecasts-in-may-at-fastest-pace-since-late-2022-20260617/" target="_blank" rel="follow" data-article-link="true">Japan exports beat forecasts in May at fastest pace since late 2022</a></p> This article was written by Eamonn Sheridan at investinglive.com.

<p class="font-claude-response-body break-words whitespace-normal">Two consecutive months of improving manufacturer sentiment adds to the case for the BoJ to proceed with its projected tightening path, with chip-sector strength providing a demand-side cushion against broader geopolitical headwinds. The chemicals and electronics sub-indices leading the gains suggest semiconductor capital expenditure cycles remain intact, a positive signal for regional supply chains. However, the sharp expected deterioration in transport machinery sentiment to minus-13 in September, from plus-13 now, flags that automakers remain exposed to supply chain disruption risks that a US-Iran framework alone may not quickly resolve. Non-manufacturers' forward guidance dropping to plus-19 from plus-32 introduces some caution on the domestic services outlook.</p><p class="font-claude-response-body break-words whitespace-normal"> Japan's Reuters Tankan showed manufacturers' sentiment rose to +13 in June from +8, and non-manufacturers to +32 from +29, driven by semiconductor demand, though both sectors see softer outlooks ahead.</p><p class="font-claude-response-body break-words whitespace-normal">Summary: Source: Reuters Tankan survey, June 2026</p><ul class="[li_&amp;]:mb-0 [li_&amp;]:mt-1 [li_&amp;]:gap-1 [&amp;:not(:last-child)_ul]:pb-1 [&amp;:not(:last-child)_ol]:pb-1 list-disc flex flex-col gap-1 pl-8 mb-3"><li class="font-claude-response-body whitespace-normal break-words pl-2">The manufacturers' sentiment index rose to +13 in June from +8 in May, a second consecutive monthly improvement, led by chemicals rising to +20 from +6 on semiconductor-related demand</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Non-manufacturers' sentiment climbed to +32 from +29, with real estate and construction driving the gain</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Manufacturers expect sentiment to hold at +13 in September; non-manufacturers project a drop to +19, citing geopolitical risks and supply chain challenges</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Transport machinery, which includes Japan's major automakers, forecasts a steep fall to minus-13 in September from plus-13, reflecting ongoing sourcing difficulties</li><li class="font-claude-response-body whitespace-normal break-words pl-2">The survey was conducted June 3-12 across 215 responding firms out of 490 polled</li><li class="font-claude-response-body whitespace-normal break-words pl-2">A potential formalisation of the US-Iran framework could support sentiment, but supply chain normalisation is expected to take time</li></ul><p class="font-claude-response-body break-words whitespace-normal"> Japanese business confidence improved across both manufacturing and services in June, with semiconductor-related demand driving the headline gains, though forward-looking indicators point to a more cautious second half, the latest Reuters Tankan survey showed.</p><p class="font-claude-response-body break-words whitespace-normal">The manufacturers' sentiment index climbed to plus-13 in June from plus-8 in May, marking a second straight month of improvement and the strongest reading in recent months. The chemicals sector led the advance, with its index jumping to plus-20 from plus-6, as firms cited resilient demand from semiconductor customers despite an uncertain geopolitical backdrop. Electronics and machinery makers reported similar conditions, with order books bolstered by chip market activity.</p><p class="font-claude-response-body break-words whitespace-normal">Non-manufacturers reported sentiment of plus-32, up from plus-29 in May, with real estate and construction confidence contributing to the gain. Housing demand was described as steady despite rising input costs, with a pipeline of new projects supporting near-term activity.</p><p class="font-claude-response-body break-words whitespace-normal">The Reuters Tankan is a monthly leading indicator for the Bank of Japan's quarterly Tankan business survey and is closely watched as a gauge of corporate conditions between official readings.</p><p class="font-claude-response-body break-words whitespace-normal">Forward guidance was more mixed. Manufacturers expect sentiment to remain flat at plus-13 in September, suggesting the current momentum is seen as sustainable but not accelerating. Non-manufacturers were more cautious, projecting a fall to plus-19, with firms pointing to geopolitical risks and supply chain uncertainties as drags on the outlook.</p><p class="font-claude-response-body break-words whitespace-normal">The sharpest divergence came from transport machinery, which encompasses Japan's major automakers. That sector's index is forecast to drop to minus-13 in September from plus-13 now, reflecting persistent difficulties in sourcing materials and ongoing disruptions to global supply chains.</p><p class="font-claude-response-body break-words whitespace-normal">A resolution of the US-Iran conflict, if formalised, could provide some relief to sentiment in coming months, but analysts cautioned that normalisation of shipping and supply chains would take time even under an optimistic diplomatic scenario.</p> This article was written by Eamonn Sheridan at investinglive.com.

<p class="font-claude-response-body break-words whitespace-normal">A coordinated G7 move toward higher tariffs on Chinese goods would represent a significant escalation in the global trade war, with direct implications for supply chains in EVs, batteries, solar and advanced machinery. European equities with China exposure, particularly German industrials and automakers already under pressure from Chinese competition, face added downside risk if Brussels moves to broaden its tariff regime beyond current sector-specific measures. Chinese export-oriented sectors and yuan-sensitive assets could reprice on any firm summit communique. The prospect of a China-EU trade dispute layered onto existing US-China tensions introduces fresh uncertainty for commodity demand, given China's role as the world's largest buyer of industrial inputs.</p><p class="font-claude-response-body break-words whitespace-normal">--- G7 leaders meeting in France are considering higher tariffs on Chinese imports as Beijing's record $1.2 trillion trade surplus redirects export pressure toward Europe, the AP reported. </p><p class="font-claude-response-body break-words whitespace-normal">Summary: Source: Associated Press</p><ul class="[li_&amp;]:mb-0 [li_&amp;]:mt-1 [li_&amp;]:gap-1 [&amp;:not(:last-child)_ul]:pb-1 [&amp;:not(:last-child)_ol]:pb-1 list-disc flex flex-col gap-1 pl-8 mb-3"><li class="font-claude-response-body whitespace-normal break-words pl-2">G7 leaders gathering in Évian-les-Bains, France have placed China's trade practices near the top of the agenda, with French officials seeking a coordinated plan to address the threat from Chinese exports</li><li class="font-claude-response-body whitespace-normal break-words pl-2">China posted a record global trade surplus of $1.2 trillion last year despite sustained US tariffs, redirecting exports toward Europe and other open markets</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Chinese exports to the 27-nation EU rose 16.4% in the January-to-May period from a year earlier, deepening trade deficits across the bloc</li><li class="font-claude-response-body whitespace-normal break-words pl-2">The EU currently imposes relatively low baseline tariffs on Chinese goods under WTO rules, with higher sector-specific duties including up to 35% on electric vehicles</li><li class="font-claude-response-body whitespace-normal break-words pl-2">China now competes directly with nearly 58% of eurozone exports, up from 46% in 2000, with Chinese firms expanding from low-cost manufacturing into EVs, advanced machinery and scientific instruments</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Germany has been among the hardest hit, with its economy shrinking in 2023 and 2024 and growing just 0.2% last year, partly due to Chinese competition in its core export industries</li></ul><p class="font-claude-response-body break-words whitespace-normal"> Leaders of the world's seven largest economies are weighing higher tariffs on Chinese goods as Beijing's surging exports increasingly threaten European industry, with France pushing for a coordinated response to emerge from the G7 summit in Évian-les-Bains this week.</p><p class="font-claude-response-body break-words whitespace-normal">The push reflects growing alarm in Europe at what analysts have labelled China Shock 2.0, a second wave of disruption from Chinese manufacturing that is more consequential than the first. China now accounts for 16% of global goods exports, up from just 4% in 2000, and its product mix has shifted dramatically upmarket. Where the first China Shock in the early 2000s centred on low-cost textiles and electronics, the current wave encompasses electric vehicles, batteries, advanced machinery, robotics and scientific instruments, putting Chinese firms in direct competition with the industrial core of the world's richest economies.</p><p class="font-claude-response-body break-words whitespace-normal">China recorded a record trade surplus of $1.2 trillion last year, even as US tariffs cut Chinese goods exports to America by 37% in the first four months of this year. The shortfall has been redirected elsewhere, with exports to the EU climbing 16.4% in the January-to-May period. France's trade deficit with China widened from $3.3 billion to $5.3 billion over a year, and Germany, once a major beneficiary of Chinese demand for its cars and machinery, now buys more from China than it sells. The German economy contracted in both 2023 and 2024 and grew only marginally last year.</p><p class="font-claude-response-body break-words whitespace-normal">The EU currently applies relatively low baseline tariffs on Chinese goods under World Trade Organization rules, though it has imposed sector-specific duties of up to 35% on electric vehicles. French officials have indicated they want the summit to produce a plan that goes further, potentially including a broader tariff wall aligned more closely with the approach the United States has taken over the past eight years.</p><p class="font-claude-response-body break-words whitespace-normal">Economists warn that China's domestic policies, including cheap state credit for manufacturers and a weak social safety net that encourages household saving over spending, structurally incentivise overproduction and export dependence. Without a change in that model, analysts say, the pressure on European industry will continue to build regardless of what individual governments do at the margin. The G7 summit may prove to be the moment Europe decides it has waited long enough to act.</p> This article was written by Eamonn Sheridan at investinglive.com.

<p>NZ Q1 current account balance (actual) -NZ$1.008B</p><ul><li> exp -NZ$0.967B, prev -NZ$5.984B</li></ul><p class="font-claude-response-body break-words whitespace-normal">NZ Q1 seasonally adjusted current account -NZ$4.552B</p><ul><li> prev -NZ$4.452B</li></ul><p class="font-claude-response-body break-words whitespace-normal">NZ year to March current account -NZ$16.3B / -3.6% of GDP.</p><p class="font-claude-response-body break-words whitespace-normal">The sharp narrowing in NZ deficit will offer the RBNZ some modest comfort on external balance pressures.</p><p class="font-claude-response-body break-words whitespace-normal">I'll have more to come on this separately </p> This article was written by Eamonn Sheridan at investinglive.com.

<ul><li><a href="https://investinglive.com/news/us-may-housing-starts-1177-million-versus-1430-million-estimate-20260616/">US May housing starts 1.177 million versus 1.430 million estimate</a></li><li><a href="https://investinglive.com/news/us-may-import-prices-19-vs-10-expected-20260616/">US May import prices +1.9% vs +1.0% expected</a></li><li><a href="https://investinglive.com/news/trump-says-iran-deal-should-be-successful-reiterates-iran-will-never-have-nuclear-weapon-20260616/">Trump says Iran deal should be successful, reiterates Iran will never have nuclear weapon</a></li><li><a href="https://investinglive.com/news/trump-says-he-expects-second-stage-of-iran-deal-to-go-quickly-20260616/">Trump says he expects second stage of Iran deal to go quickly</a></li><li><a href="https://investinglive.com/centralbank/fed-preview-warsh-walks-into-a-minefield-a-look-at-early-stumbles-of-other-chairmen-20260616/">Fed preview: Warsh walks into a minefield -- a look at early stumbles of other Chairmen</a></li><li><a href="https://investinglive.com/commodities/oil-falls-further-on-a-report-that-iran-could-be-allowed-to-immediately-sell-oil-20260616/">Oil falls further on a report that Iran could be allowed to immediately sell oil</a></li></ul><p>Markets:</p><ul><li>S&amp;P 500 down 0.6%</li><li>Nasdaq down 1.1%</li><li>WTI crude oil down $4.12 to $76.63</li><li>US 10-year yields down 3 bps to 4.44%</li><li>EUR leads, CHF lags</li><li>Gold up $26 to $4333</li></ul><p>Oil continued to plummet on Tuesday as it fell another $4. After the bell, the API private inventory numbers showed another huge drawdown in oil supplies and that's likely to continue for at least another week with the deal not set to be signed until Friday. In any case, the oil market is looking forward and sees the resumption of flows. Either that, or the oil longs are capitulating.</p><p>What's notable is that the cross-asset reaction isn't as big as you'd expect for a 4.5% decline in crude. US Treasury yields fell 2-3 bps and the FX market was largely unmoved on the day. Even oil equities had a skeptical look with the XLE ETF down just 0.3%.</p><p>In the broader equity markets, there was some profit taking in the Nasdaq to lead stocks lower. High flying Intel was knocked down 8% and looks like it could be forming a double top. Micron also formed and outside day and was down 6%. Broadcom and Nvidia were also lower but eyes were on SpaceX, which squeezed as much as 20% higher before finishing up just 4.8%.</p><p>Overall volatility was likely cooled by the Fed decision on Wednesday, which will be the first one from Kevin Warsh.</p> This article was written by Adam Button at investinglive.com.

<p>Data from New Zealand, Japan and Australia due today. None of this is likely to move around financial markets too much upn release. Instead, to day will be spent waiting on the FOMC and specualting about the nuanaces around the expected on hold decision. </p><ul><li><a href="https://investinglive.com/centralbank/fed-preview-warsh-walks-into-a-minefield-a-look-at-early-stumbles-of-other-chairmen-20260616/" target="_blank" rel="follow" data-article-link="true">Fed preview: Warsh walks into a minefield -- a look at early stumbles of other Chairmen</a></li></ul> This article was written by Eamonn Sheridan at investinglive.com.

<ul><li>High yield 4.927%</li><li>WI level at the time of the auction 4.937%</li><li>Tail -1.0 basis points versus average of -0.1 basis points</li><li>Bid to cover 2.75X versus average of 2.65X</li><li>Directs (domestic demand) 19.9% versus average of 24.3%</li><li>Indirects (international demand) 73.2% versus average of 64.9%</li><li>Dealers 8.5% versus average of 10.8%</li></ul><p>Auction Grade A-</p><p>The component pieces of the auction all were better than the averages with the exception of the domestic buyers who are squeezed out by the international buyers who exerted strong demand for the issue. </p><p>The 20 year issue is not a major interest for investors. </p><p data-section-id="4z13rp" data-start="131" data-end="145">High Yield</p><p data-start="146" data-end="266">The high yield is the highest yield accepted at the auction and becomes the yield awarded to all successful bidders.</p><ul data-start="268" data-end="360"><li data-section-id="1g2snqy" data-start="268" data-end="313">Higher-than-expected yield = weaker demand.</li><li data-section-id="w6jlm3" data-start="314" data-end="360">Lower-than-expected yield = stronger demand.</li></ul><p data-section-id="ynqs9i" data-start="362" data-end="370">Tail </p><p data-start="371" data-end="532">The tail measures the difference between the auction's high yield and the yield where the bond was trading just before the auction (the "when-issued" yield).</p><ul data-start="534" data-end="675"><li data-section-id="1c5a2yy" data-start="534" data-end="595">Positive tail (high yield above WI yield) = weaker auction.</li><li data-section-id="5hssza" data-start="596" data-end="675">Negative tail or stop-through (high yield below WI yield) = stronger auction.</li></ul><p data-start="677" data-end="689">Example:</p><ul data-start="690" data-end="766"><li data-section-id="18q3i5n" data-start="690" data-end="707">WI yield: 4.50%</li><li data-section-id="1o3xjzn" data-start="708" data-end="735">Auction high yield: 4.53%</li><li data-section-id="1ausv12" data-start="736" data-end="766">Tail: +3 basis points (weak)</li></ul><p data-section-id="kr9wwu" data-start="768" data-end="790">Bid-to-Cover Ratio</p><p data-start="791" data-end="878">The bid-to-cover ratio measures total bids received relative to the amount offered.</p><p data-start="880" data-end="935">Formula:Bid-to-Cover = Total Bids ÷ Amount Offered</p><p data-start="937" data-end="949">Example:</p><ul data-start="950" data-end="1031"><li data-section-id="l5do4l" data-start="950" data-end="978">Treasury sells $22 billion</li><li data-section-id="1ihox58" data-start="979" data-end="1009">Receives $55 billion in bids</li><li data-section-id="1k3nrjp" data-start="1010" data-end="1031">Bid-to-cover = 2.50</li></ul><p data-start="1033" data-end="1082">Higher ratios generally indicate stronger demand.</p><p data-section-id="o3s15s" data-start="1084" data-end="1106">Direct Bidders (%)</p><p data-start="1107" data-end="1159">Direct bidders submit bids directly to the Treasury.</p><p data-start="1161" data-end="1180">Typically includes:</p><ul data-start="1181" data-end="1256"><li data-section-id="16ip39y" data-start="1181" data-end="1206">Domestic money managers</li><li data-section-id="1oaa5uq" data-start="1207" data-end="1222">Pension funds</li><li data-section-id="jajjqu" data-start="1223" data-end="1237">Mutual funds</li><li data-section-id="1vauzct" data-start="1238" data-end="1256">Some hedge funds</li></ul><p data-start="1258" data-end="1334">A higher direct percentage often suggests strong domestic investor interest.</p><p data-section-id="1g4hdqf" data-start="1336" data-end="1360">Indirect Bidders (%)</p><p data-start="1361" data-end="1392">Indirect bidders are primarily:</p><ul data-start="1393" data-end="1464"><li data-section-id="jnyo0" data-start="1393" data-end="1416">Foreign central banks</li><li data-section-id="1ao14s9" data-start="1417" data-end="1441">Sovereign wealth funds</li><li data-section-id="11u0jtd" data-start="1442" data-end="1464">Foreign institutions</li></ul><p data-start="1466" data-end="1514">This is often the most closely watched category.</p><p data-start="1516" data-end="1631">A high indirect take is usually viewed as a positive sign because it indicates strong foreign demand for U.S. debt.</p><p data-section-id="1vgukay" data-start="1633" data-end="1648">Dealers (%) </p><p data-start="1649" data-end="1736">Primary dealers are required to participate and buy any securities not taken by others.</p><p data-start="1738" data-end="1755">Examples include:</p><ul data-start="1756" data-end="1875"><li data-section-id="15a85x" data-start="1756" data-end="1795">JPMorgan Chase</li><li data-section-id="lyf7sl" data-start="1796" data-end="1835">Goldman Sachs</li><li data-section-id="wlg39x" data-start="1836" data-end="1875">Bank of America</li></ul><p data-start="1877" data-end="2002">A high dealer allocation is generally viewed as a negative because it means investors were less willing to absorb the supply.</p><p data-section-id="xz0ej8" data-start="2009" data-end="2036">Quick Auction Scorecard</p> This article was written by Greg Michalowski at investinglive.com.

<p>Comments from Trump:</p><ul><li>Will release text of Iran agreement in a formal setting</li><li>MOU states clearly Iran will not have a nuclear weapon</li><li>Will have a news conference on the Iran deal</li><li>Will go over Iran MOU with media in a couple days</li><li>Agreement is about one thing: Iran will never have a nuclear weapon</li><li>Likes the idea of sending the agreement to Congress for review</li><li>We are in a position to let Russian oil waivers lapse</li><li>Soon we'll be able to do increased sanctions on Russia</li><li>Iran talks could be lengthened or shortened</li></ul><p>The obvious reason is that he's not releasing the text is that it's a terrible deal to get out of a bad war. JD Vance is also out there saying that Iran won't get a cent of US money but there's a $300 billion number floating around.</p> This article was written by Adam Button at investinglive.com.

<ul><li>Prior was +1.9% (revised to +2.0%)</li><li>Import prices up 6.7% y/y</li><li>Export prices +1.3% vs +1.2% expected</li><li>Prior export prices +3.3% (revised to +3.5%)</li></ul><p>The US dollar is relatively flat today ahead of the data as we wait for Wednesday's FOMC decision. This report will give them a bit extra to think about on the inflation side as prices continue to rise for imported goods. The big caveat is that WTI crude is down to $77.64, which is the lowest since March 10. That should lead to a material drop in the upcoming m/m readings.</p><p>In terms of details, imported fuel prices rose 12.5% in May on top of 18.6% in April and 10.2% in March. That 47% three-month surge is the largest since the COVID rebound period ended July 2020.</p><p>What's more worrisome is that nonfuel import prices rose 0.8% in May and 3.7% over the year — the fastest 12-month pace since August 2022. Consumer goods ex-autos jumped 0.5%, the biggest monthly gain since January 2024. Capital goods +1.3%. </p><p class="font-claude-response-body break-words whitespace-normal">For background, the US Import and Export Price Indexes, published monthly by the Bureau of Labor Statistics, track what Americans pay for foreign goods and what foreigners pay for American ones. It's the unglamorous cousin of CPI and PPI — released mid-month, after the inflation prints that move markets — but it's the cleanest read on imported price pressure and the terms of trade. Crucially, it measures prices at the border, before domestic margins and retail markups distort the signal, which makes it the single best gauge of whether tariffs are being absorbed by foreign exporters or passed straight to U.S. buyers.</p><p class="font-claude-response-body break-words whitespace-normal">The April report leaned hot. Import prices rose 1.9 percent in April following a 0.9 percent increase in March, with higher fuel costs doing the heavy lifting. That pushed the 12-month rate of import inflation to 4.2 percent, up from 2.3 percent in March and just 0.2 percent at the start of the year — a remarkably steep acceleration in four months. Strip out the fuel noise and the picture is firmer but tamer: capital goods prices climbed 1.1 percent, consumer goods ex-autos rose 0.4 percent, and automotive prices slipped 0.1 percent.</p><p class="font-claude-response-body break-words whitespace-normal">The export side ran even hotter. Export prices jumped 3.3 percent in April and 8.8 percent over the year, the largest over-the-year advance since the index rose 9.8 percent for the year ended September 2022. Agricultural exports added 1.6 percent on the month.</p> This article was written by Adam Button at investinglive.com.

<ul><li>Prior month housing starts 1.465 million revised lower 21.392 million</li><li>Prior month building permits 1.442 million .</li></ul><p>Data for May: </p><ul><li>Housing starts 1.177M vs 1.430 million estimate</li><li>Housing starts -15.4% vs -8.5% last month last mont</li><li>Building Permits 1.413M vs 1.420M estimate</li><li>Building permits -0.7% versus +5.8% last month.</li></ul><p>Housing starts fall sharply:</p><ul data-start="36" data-end="384"><li data-section-id="e29820" data-start="198" data-end="305">Single-family housing starts: 882,000 annualized units <ul data-start="261" data-end="305"><li data-section-id="12pazw6" data-start="261" data-end="305">-1.9% vs. April's revised 899,000 pace </li></ul></li><li data-section-id="3uusp3" data-start="307" data-end="384">Multi-family housing starts (5 units or more): 284,000 annualized units.The April rate for units in buildings with five units or more was 529,000.</li></ul><p>Although single family housing starts fell, the multifamily housing starts plunged from 529,000 to 284,000</p><p data-section-id="1va804k" data-start="386" data-end="402">Key Takeaway from the housing starts</p><ul data-start="403" data-end="765" data-is-last-node="" data-is-only-node=""><li data-section-id="10opunr" data-start="403" data-end="505"> Housing starts fell sharply in May, driven primarily by weakness in the overall construction sector. </li><li data-section-id="9jo98a" data-start="506" data-end="630"> Single-family construction declined only modestly, while the larger drop came from the more volatile multi-family segment. </li><li data-section-id="1efo44a" data-start="631" data-end="765" data-is-last-node=""> The data points to continued softness in residential construction activity amid higher borrowing costs and affordability challenges.</li></ul><p>Details of the Building Permits data:</p><ul data-start="38" data-end="373"><li data-section-id="1jh2ugr" data-start="201" data-end="301">Single-family permits: 886,000 annualized units <ul data-start="257" data-end="301"><li data-section-id="1rytxbr" data-start="257" data-end="301">+0.6% vs. April's revised 881,000 pace </li></ul></li><li data-section-id="1mpozmg" data-start="303" data-end="373">Multi-family permits (5 units or more): 474,000 annualized units. Authorizations of units in buildings with five units or more were at a rate of 514,000 in April.</li></ul><p data-section-id="1va804k" data-start="375" data-end="391">Key Takeaway from the building permits.</p><ul data-start="392" data-end="779" data-is-last-node="" data-is-only-node=""><li data-section-id="c76w36" data-start="392" data-end="498"> Building permits were little changed in May, slipping modestly from both the prior month and a year ago. </li><li data-section-id="1btr5lx" data-start="499" data-end="654"> Single-family permits edged higher, suggesting builders remain willing to add new projects despite affordability challenges and elevated financing costs. </li><li data-section-id="1lfyzoh" data-start="655" data-end="779" data-is-last-node=""> The overall softness in permits reflects continued caution in the housing sector, particularly in the multi-family market.</li></ul><p data-section-id="ghmpme" data-start="0" data-end="39">U.S. Housing Completions – May 2026</p><ul data-start="41" data-end="388"><li data-section-id="14pmuap" data-start="41" data-end="206">Total housing completions: 1.313 million annualized units <ul data-start="107" data-end="206"><li data-section-id="1nz1dlr" data-start="107" data-end="157">-8.1% vs. April's revised 1.429 million pace </li><li data-section-id="1qhfhtw" data-start="160" data-end="206">-14.2% vs. May 2025's 1.530 million pace </li></ul></li><li data-section-id="1kczm5f" data-start="208" data-end="312">Single-family completions: 872,000 annualized units <ul data-start="268" data-end="312"><li data-section-id="1ddahlj" data-start="268" data-end="312">-1.6% vs. April's revised 886,000 pace </li></ul></li><li data-section-id="43zwj0" data-start="314" data-end="388">Multi-family completions (5 units or more): 426,000 annualized units </li></ul><p data-section-id="1va804k" data-start="390" data-end="406">Key Takeaway</p><ul data-start="407" data-end="817" data-is-last-node="" data-is-only-node=""><li data-section-id="e15q4w" data-start="407" data-end="505"> Housing completions fell sharply in May, declining both from the prior month and a year earlier. </li><li data-section-id="1t0wl6r" data-start="506" data-end="588"> Single-family completions were relatively steady, posting only a modest decline. </li><li data-section-id="16d8c0e" data-start="589" data-end="817" data-is-last-node=""> The broader weakness points to a slowdown in the pace at which homes are being delivered to the market, suggesting residential construction activity remains under pressure amid higher financing costs and softer housing demand.</li></ul><p>THe Nasdaq has turned into negative territory in pre-market trading (down -40 points). The Dow is still marginally higher. The S&amp;P id down -0.79 points. </p><p>Yields are marginally lower. The 10 year is down -2.7 basis points at 4.441%. The 2 year is down -1.2 basis points at 4.051%</p> This article was written by Greg Michalowski at investinglive.com.

<ul><li><a href="https://investinglive.com/news/iranian-tankers-pass-through-the-strait-of-hormuz-as-the-us-lifts-its-naval-blockade-20260616/">Iranian tankers pass through the Strait of Hormuz as the US lifts its naval blockade</a></li><li><a href="https://investinglive.com/news/trump-says-iran-deal-should-be-successful-reiterates-iran-will-never-have-nuclear-weapon-20260616/">Trump says Iran deal should be successful, reiterates Iran will never have nuclear weapon</a></li><li><a href="https://investinglive.com/news/iran-outlines-that-nuclear-talks-will-include-enrichment-stockpile-and-its-nuclear-needs-20260616/">Iran outlines that nuclear talks will include enrichment, stockpile, and its nuclear needs</a></li><li><a href="https://investinglive.com/news/germany-june-zew-survey-current-conditions-810-vs-780-expected-20260616/">German economic sentiment picks up in June as US-Iran conflict simmers down</a></li><li><a href="https://investinglive.com/commodities/oil-prices-extend-losses-and-target-pre-war-levels-amid-expectations-of-hormuz-reopening-20260616/">Oil prices extend losses and target pre-war levels amid expectations of Hormuz reopening</a></li><li><a href="https://investinglive.com/news/italy-may-final-cpi-32-vs-32-yy-prelim-20260616/">Italy inflation confirmed to have nudged up in May</a></li><li><a href="https://investinglive.com/commodities/gold-avoids-a-complete-breakdown-on-surprising-us-iran-breakthrough-as-focus-turns-to-fomc-20260616/">Gold avoids a complete breakdown on surprising US-Iran breakthrough as focus turns to FOMC</a></li><li><a href="https://investinglive.com/centralbank/boj-deputy-governor-uchida-says-that-ueda-absence-not-a-big-impact-on-decision-today-20260616/">BOJ deputy governor Uchida says that Ueda absence not a big impact on decision today</a></li><li><a href="https://investinglive.com/centralbank/boj-deputy-governor-uchida-says-will-continue-to-raise-policy-rate-if-conditions-align-20260616/">BOJ deputy governor Uchida says will continue to raise policy rate if conditions align</a></li><li><a href="https://investinglive.com/news/what-are-the-main-events-for-today-20260616/">What are the main events for today?</a></li><li><a href="https://investinglive.com/news/japan-finance-minister-says-wont-comment-on-boj-decision-until-after-press-conference-20260616/">Japan finance minister says won't comment on BOJ decision until after press conference</a></li><li><a href="https://investinglive.com/centralbank/rba-governor-bullock-i-want-to-be-clear-that-inflation-remains-too-high-20260616/">RBA governor Bullock: I want to be clear that inflation remains too high</a></li><li><a href="https://investinglive.com/forex/intervention-risks-abound-as-the-japanese-yen-cant-get-off-the-floor-20260616/">Intervention risks abound as the Japanese yen can't get off the floor</a></li><li><a href="https://investinglive.com/Orders/fx-option-expiries-for-16-june-10am-new-york-cut-20260616/">FX option expiries for 16 June 10am New York cut</a></li><li><a href="https://investinglive.com/centralbank/rba-leaves-cash-rate-unchanged-at-435-in-june-monetary-policy-meeting-as-expected-20260616/">RBA leaves cash rate unchanged at 4.35% in June monetary policy meeting, as expected</a></li></ul><p class="isSelectedEnd">The most important news in the European session was reports of Iranian tankers successfully passing through the Strait of Hormuz following the US decision to lift its naval blockade, marking the clearest sign yet that the US-Iran memorandum of understanding is translating into practical implementation. </p><p class="isSelectedEnd">The Reserve Bank of Australia (RBA) left its cash rate unchanged at 4.35%, in line with market expectations, pausing after three consecutive rate hikes earlier in 2026. Policymakers opted to hold rates steady to assess the delayed impact of previous tightening on consumer demand, housing, and inflation. The RBA made clear that monetary policy remains restrictive and data-dependent.</p><p class="isSelectedEnd">RBA Governor Bullock acknowledged slower growth and pressure on households but emphasized that underlying inflation remains above target and that higher fuel costs are increasingly feeding into broader prices. Her comments suggested the RBA remains prepared to hike again if inflation proves sticky. The market, on the other hand, is not pricing any more rate hikes following weak Australian data in the past weeks and the US-Iran breakthrough. </p><p class="isSelectedEnd">Deputy Governor Uchida held the BoJ press conference on behalf of Governor Ueda and reiterated that the central bank will continue raising the rates if economic and inflation conditions evolve as expected, maintaining the normalization narrative. He showed confidence that wage growth and inflation momentum remain sufficiently strong to justify gradual tightening, supporting expectations for further rate hikes later in the year. The Japanese yen weakened due to lack of strong hawkish signals. </p> This article was written by Giuseppe Dellamotta at investinglive.com.

<p class="isSelectedEnd">Iranian oil tankers successfully passed through the Strait of Hormuz after the US lifted its naval blockade, marking one of the clearest signs yet that the Memorandum of Understanding (MoU) between the two countries is beginning to take effect.</p><p class="isSelectedEnd">According to Iranian state-linked outlet ISNA, citing Deputy Foreign Minister officials, Iran confirmed that the US naval blockade restricting Iranian maritime movement is being lifted. The development was reinforced by reports from Al Jazeera, which confirmed that vessels were transiting the waterway and that Iranian tankers had successfully navigated the strait.</p><p class="isSelectedEnd">The tanker passages serve as a verification mechanism for the MoU, which is expected to be signed on Friday after weeks of intense diplomacy. The latest development suggests both the US and Iran are moving from political commitments to operational implementation. </p><p class="isSelectedEnd">The next major test will be whether the reopening becomes routine or whether Hormuz remains a controlled corridor subject to Iranian tolls, inspections, or transit restrictions.</p> This article was written by Giuseppe Dellamotta at investinglive.com.

<ul><li>Iran deal should be successful</li><li>Iran deal is a fair, good deal</li><li>Iran deal goes to a second stage</li><li>We're not investing any money in Iran</li><li>Iran will never have a nuclear weapon</li><li>All hell will break out in Iran if Iran tries to get a nuclear weapon</li><li>We're dealing with rational people in Iran </li><li>Leaders in Iran are looking to help their country</li><li>Iran is now in the rear-view mirror</li><li>We're going to get the nuclear material in Iran</li><li>The deal can survive if Israel attacks Lebanon</li><li>I consider the Lebanon war a minor one and the Iran deal can survive</li></ul><p class="isSelectedEnd">Trump said the “Iran deal should be successful” and described the agreement as “a fair, good deal”. His remarks come after the major breakthrough, with both the US and Iran confirming that the text of the Memorandum of Understanding (MoU) has been finalized and is awaiting formal ceremony in Geneva, Switzerland.</p><p class="isSelectedEnd">Trump emphasized that the current framework “goes to a second stage”, suggesting Friday’s signing is not the end of negotiations but the beginning of an implementation period. That second phase is expected to focus heavily on verification, sanctions relief sequencing, and the future of Iran’s nuclear infrastructure. </p><p class="isSelectedEnd">While the broad political framework appears agreed, technical details, including uranium stockpiles, enrichment limits, and inspection mechanisms, remain unresolved and are expected to dominate the next 60 days of talks. What matter for market though is the reopening of the Strait of Hormuz which is expected to return to normal traffic in the coming months.</p><p class="isSelectedEnd">Trump has also reiterated that the US is “not investing any money in Iran” aimed at preempting criticism from people who fear the US may be offering Iran large economic concessions. The comment directly addresses speculation surrounding possible Iranian access to frozen assets or infrastructure funding tied to compliance. Trump and Vice President JD Vance have both stressed that any economic relief would be conditional and performance-based rather than an upfront financial transfer.</p><p class="isSelectedEnd">Trump has also emphasized that “Iran will never have a nuclear weapon” repeating the central red line. He coupled that with a warning by saying that Iran would “suffer” and “all hell will break out” if Iran attempts to pursue nuclear weapons. The last comments saying that "Iran is now is the rear-view mirror" and "the deal can survive Israel attacks on Lebanon" suggest he's done with this for good and really wants to move on. </p> This article was written by Giuseppe Dellamotta at investinglive.com.

<p class="text-align-justify">The framework agreement for the memorandum of understanding this week can be said to be the "easy part". And that says a lot about how the next phase of talks is going to proceed, considering the circumstances.</p><p class="text-align-justify">That being nuclear discussions between the two sides. And Iran is quick to outline what the key argument points will be when we get to that over the next 60 days.</p><p class="text-align-justify">The first will be enrichment. As a reminder, uranium must be enriched i.e. increase its concentration in order to be useful for other purposes. For commercial usage, the enrichment purity is around 3% to 5% typically and even for medical research purposes it should be up to around 20%.</p><p class="text-align-justify">The reality of the situation is that Iran possesses a huge amount highly-enriched uranium - up to 60% purity. At this level, it takes very little effort to push it to 90% where it will meet the weapons-grade threshold for a nuclear bomb.</p><p class="text-align-justify">As such, one of the key demands by the US is that they want a hard cap on Iran's enrichment and preferably a complete suspension on that.</p><p class="text-align-justify">The second point will be on the current enriched uranium stockpile. That ties to whatever highly-enriched uranium that Iran already possesses at its facilities. The amount is said to be in the hundreds of kilograms, which means they can easily refine them further in a quick turnaround time to produce a nuclear weapon of sorts.</p><p class="text-align-justify">In that lieu, the US wants Iran to dismantle its nuclear program completely while diluting i.e. blend the uranium to safer levels, the stockpile and/or move the stockpile out of the country as an additional safety buffer.</p><p class="text-align-justify">The final point is on Iran's nuclear needs. Iran is holding a hard line that enriching uranium is a sovereign right. Their justification is that the nuclear facilities built are entirely for civilian purposes. As examples, Iran is arguing that they need it for generating electricity as well as for scientific and medical research purposes.</p><p class="text-align-justify">However, the US (and everyone else's) argument is that Iran does not possess the specific types of power reactors or medical facilities that would actually require 60% enriched uranium. As such, the whole point is moot as it is a poor disguise of Iran's pursuit of a nuclear weapons capability.</p><p class="text-align-justify">But for Iran, giving that up would be to give up its sovereignty and any diplomatic leverage it holds in any form of negotiations with its neighbours and also "enemies".</p><p class="text-align-justify">Taking all of that together, there is a big gap that needs to be bridged between the US and Iran over the next 60 days. And frankly speaking, I don't see how they will be able to manage that all of a sudden after having butted heads for so many years already.</p><p class="text-align-justify">Iran will surely look to delay things by kicking the can down the road with empty baseline promises. That in exchange for further sanctions relief and more unfreezing of its assets. The only question now is, will Trump be willing to accept that or will we see the war return at some point after Iran takes him for a joy ride over the coming months?</p> This article was written by Justin Low at investinglive.com.

<ul><li>Current conditions -81.0 vs -78.0 expected</li><li>Prior -77.8</li><li>Outlook 10.5 vs -6.0 expected</li><li>Prior -10.2</li></ul><p class="text-align-justify">The current conditions reading might be poor, falling to its weakest since December last year. However, the good news is that the outlook reading has rebounded back to positive territory. And that likely reflects the optimism tied to the latest US-Iran developments.</p><p class="text-align-justify">While German investor sentiment remains in the dumps for now, the expectation is that things should improve as the Strait of Hormuz looks to reopen at some point after the US and Iran signs off on a framework agreement.</p><p class="text-align-justify">US president Trump has claimed that it will be "fully reopened" on Friday but Iran has said that they might need time to manage things as they have to also "clear off mines". Both sides will likely agree to a 30-day period to gradually reopen the waterway, all the while Iran continues to maintain control over traffic flows.</p> This article was written by Justin Low at investinglive.com.

<ul><li>CPI +3.2% vs +3.2% y/y prelim</li><li>Prior +2.7%</li><li>HICP +3.2% vs +3.3% y/y prelim</li><li>Prior +2.8%</li></ul><p class="text-align-justify">The final estimates here confirm that Italy's headline annual inflation accelerated in May, largely due to the energy price dynamics.</p><p class="text-align-justify">Of note, prices for non-regulated energy products were seen up 12.5% compared to a year ago (+9.5% prior) and for regulated energy products up 5.6% relative to May last year (5.3% prior).</p><p class="text-align-justify">As for core annual inflation, that is seen moving up to 1.7% in May - a slight nudge higher compared to the 1.6% reading in April.</p><p class="text-align-justify">The breakdown shows goods price inflation also coming in higher at 3.4% (previously 3.1%) and services inflation also the same at 2.8% (previously 2.4%). Food prices were a little lower though in May, seen at 1.9% (previously 2.3%) on the month.</p> This article was written by Justin Low at investinglive.com.

<p>EUROPEAN SESSION</p><p>In the European session, we don't have much on the agenda other than a couple of low tier releases like the Italian final CPI and the German ZEW index. The data won't change anything for the ECB, so the market reaction will likely be muted. Moreover, we can expect sentiment indices like the ZEW or PMIs to improve in the next months on easing rate hike expectations and lower energy prices. </p><p>AMERICAN SESSION</p><p>In the American session, the only highlight is the US housing starts and building permits report. This is not market-moving data and won't change anything for the Fed. </p><p>The markets are now focused on the positive effects stemming from the US-Iran deal and the official end of the war. Expectations of lower oil prices are easing inflation concerns and leading to a dovish repricing in interest rates. The short-term effect is certainly positive for growth and risk assets like stocks are the main beneficiaries. </p><p>Looking ahead, the question will be whether this negative supply shock turns into a positive demand one where economic activity strengthens significantly and keeps inflationary pressure high eventually forcing the Fed to intervene with rate hikes. This is likely going to be the next tail risk for markets.</p><p>CENTRAL BANK SPEAKERS</p><ul><li>10:55 GMT/06:55 ET - ECB's Escriva (neutral - voter)</li><li>13:10 GMT/09:10 ET - ECB's Lane (neutral - voter)</li><li>19:05 GMT/15:05 ET - ECB's Sleijpen (neutral - voter)</li></ul> This article was written by Giuseppe Dellamotta at investinglive.com.

<p class="text-align-justify">She says that she won't offer any comments on the BOJ decision until after the press conference by deputy governor Uchida later.</p><p class="text-align-justify">As a reminder, BOJ governor Ueda wasn't present at this meeting as he was admitted to the hospital last week <a href="https://investinglive.com/centralbank/boj-governor-ueda-has-been-hospitalised-expected-to-be-absent-from-next-weeks-meeting-20260610/" target="_blank" rel="follow">here</a>. As such, Uchida will also be filling in for the BOJ press conference at the bottom of the hour.</p><p class="text-align-justify">Anyway, it is a fair assumption that Katayama was questioned about if the ministry of finance might feel compelled to act given the market response to the BOJ decision. <a href="https://investinglive.com/forex/intervention-risks-abound-as-the-japanese-yen-cant-get-off-the-floor-20260616/" target="_blank" rel="follow">USD/JPY continues to trade above 160.00</a>, in line with where they decided to intervene the last time at the end of April.</p><p class="text-align-justify">And as a reminder, that also came two days after the BOJ decision at the time.</p> This article was written by Justin Low at investinglive.com.

<ul><li><a href="https://investinglive.com/centralbank/boj-hikes-to-1-pauses-bond-taper-from-april-2027-and-flags-inflation-overshoot-risk-20260616/">BOJ hikes to 1%, pauses bond taper from April 2027 and flags inflation overshoot risk</a></li><li><a href="https://investinglive.com/centralbank/bank-of-japan-25bp-rate-hike-to-1-as-widely-expected-20260616/">Bank of Japan 25bp rate hike to 1%, as widely expected</a></li><li><a href="https://investinglive.com/commodities/goldman-cuts-brent-forecast-to-80-for-2026-75-for-2027-on-hormuz-deal-20260616/">Goldman cuts Brent forecast to $80 for 2026, $75 for 2027 on Hormuz deal</a></li><li><a href="https://investinglive.com/news/china-may-data-industrial-output-beats-but-retail-sales-post-first-fall-since-2022-20260616/">China May data: industrial output beats but retail sales post first fall since 2022</a></li><li><a href="https://investinglive.com/centralbank/boj-set-to-hit-1-but-vote-split-bond-taper-pause-and-july-signals-are-the-real-story-20260616/">BOJ set to hit 1% but vote split, bond taper pause and July signals are the real story</a></li><li><a href="https://investinglive.com/news/china-data-may-2026-industrial-output-45-yy-expected-42-20260616/">China data May 2026: Industrial output +4.5% y/y (expected +4.2%)</a></li><li><a href="https://investinglive.com/news/china-house-prices-may-2026-35-yy-prior-35-20260616/">China house prices May 2026 -3.5% y/y (prior -3.5%)</a></li><li><a href="https://investinglive.com/commodities/oil-price-path-to-the-60s-pre-war-levels-could-take-years-despite-hormuz-deal-analysts-20260616/">Oil price path to the $60s pre-war levels could take years despite Hormuz deal, analysts</a></li><li><a href="https://investinglive.com/centralbank/pboc-sets-usd-cny-mid-point-today-at-68108-vs-estimate-at-67605-20260616/">PBOC sets USD/ CNY mid-point today at 6.8108 (vs. estimate at 6.7605)</a></li><li><a href="https://investinglive.com/centralbank/jgbs-steady-nikkei-eases-from-record-high-as-boj-rate-decision-looms-20260616/">JGBs steady, Nikkei eases from record high as BOJ rate decision looms</a></li><li><a href="https://investinglive.com/news/gm-in-talks-with-lockheed-to-make-weapons-parts-as-pentagon-seeks-to-restock-20260616/">GM in talks with Lockheed to make weapons parts as Pentagon seeks to restock</a></li><li><a href="https://investinglive.com/commodities/analysts-back-iran-deal-as-oil-price-catalyst-but-warn-peace-dividend-wont-be-instant-20260615/">Analysts back Iran deal as oil price catalyst but warn peace dividend won't be instant</a></li><li><a href="https://investinglive.com/centralbank/boj-hike-certain-rba-and-fed-on-hold-as-iran-deal-reshapes-central-bank-outlook-20260615/">BOJ hike certain, RBA and Fed on hold as Iran deal reshapes central bank outlook</a></li><li><a href="https://investinglive.com/news/new-zealand-data-may-2026-food-price-inflation-10-mm-prior-flat-at-0-20260615/">New Zealand data: May 2026 Food Price Inflation +1.0% m/m (prior flat at 0%)</a></li><li><a href="https://investinglive.com/stock-market-update/hedge-funds-dust-off-pre-war-playbooks-as-iran-deal-reshapes-market-outlook-noodle-pivot-20260615/">Hedge funds dust off pre-war playbooks as Iran deal reshapes market outlook - noodle pivot</a></li><li><a href="https://investinglive.com/commodities/barclays-sees-gold-hitting-4900-as-iran-driven-correction-fades-20260615/">Barclays sees gold hitting $4,900 as Iran-driven correction fades</a></li><li><a href="https://investinglive.com/centralbank/bank-of-japan-today-preview-set-to-lift-rates-to-31-year-high-as-iran-deal-clouds-path-20260615/">Bank of Japan today - preview - set to lift rates to 31-year high as Iran deal clouds path</a></li><li><a href="https://investinglive.com/commodities/explosions-heard-in-the-strait-of-hormuz-20260615/">Explosions heard in the Strait of Hormuz</a></li><li><a href="https://investinglive.com/commodities/hormuz-reopening-road-map-mines-insurance-and-stranded-ships-slow-the-path-for-oil-flow-20260615/">Hormuz reopening road map: mines, insurance and stranded ships slow the path for oil flow</a></li><li><a href="https://investinglive.com/news/hormuz-reopening-framework-a-fragile-first-step-says-sp-global-20260615/">Hormuz reopening framework a fragile first step, says S&amp;P Global</a></li></ul><p>-</p><p class="font-claude-response-body break-words whitespace-normal">BOJ hikes to 31-year high as Iran deal lifts regional sentiment</p><ul class="[li_&amp;]:mb-0 [li_&amp;]:mt-1 [li_&amp;]:gap-1 [&amp;:not(:last-child)_ul]:pb-1 [&amp;:not(:last-child)_ol]:pb-1 list-disc flex flex-col gap-1 pl-8 mb-3"><li class="font-claude-response-body whitespace-normal break-words pl-2">Bank of Japan raised its policy rate to 1%, a 31-year high, and announced a pause in JGB tapering from April 2027; the yen barely moved with USD/JPY holding above 160.00</li><li class="font-claude-response-body whitespace-normal break-words pl-2">The Nikkei and Topix dipped earlier in the session before bouncing on the BOJ decision headline; South Korean shares extended gains tracking Wall Street's Iran deal rally</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Goldman Sachs cut its Q4 2026 Brent forecast to $80 from $90 and its 2027 average to $75 from $80, bringing forward Gulf export normalisation to end-July</li><li class="font-claude-response-body whitespace-normal break-words pl-2">China's May data showed industrial output beating at 4.5% but retail sales posting their first annual decline since the pandemic, down 0.6%, while fixed asset investment deteriorated sharply</li><li class="font-claude-response-body whitespace-normal break-words pl-2">China's new home prices fell at a slightly faster monthly pace in May, with the property sector continuing to grapple with fragile demand despite tentative stabilisation in larger cities</li></ul><p class="font-claude-response-body break-words whitespace-normal">The Bank of Japan delivered its widely anticipated rate hike on Tuesday, lifting its policy rate to 1% from 0.75% and taking borrowing costs to their highest level since 1995. The decision was accompanied by a confirmation that the BOJ will pause its programme of monthly JGB purchase reductions from April 2027, fixing the buying pace at around 2 trillion yen per month. The inflation outlook was characterised in notably direct terms, with the BOJ flagging upside risk to its 2% CPI target and projecting a year-on-year increase clearly above that level in the period ahead.</p><p class="font-claude-response-body break-words whitespace-normal">The yen's reaction was muted. USD/JPY held above 160.00 in the wake of the decision, a reminder that the market has long argued the currency needs real economy momentum and a credible path of sustained tightening rather than incremental moves to stage a durable recovery. The Nikkei and Topix had drifted lower ahead of the announcement before bouncing on the decision headline, with both indices ending the session off Monday's record highs.</p><p class="font-claude-response-body break-words whitespace-normal">Broader regional sentiment remained constructive, underpinned by the US-Iran peace framework. South Korean shares extended the prior session's gains, tracking Wall Street's overnight rally as the deal continued to lift risk appetite across Asian markets.</p><p class="font-claude-response-body break-words whitespace-normal">Goldman Sachs added further weight to the oil market's repricing, cutting its Q4 2026 Brent forecast to $80 per barrel from $90 and its 2027 average to $75 from $80. The bank brought forward its assumption for Persian Gulf export normalisation to end-July from end-August, reflecting growing confidence in the pace of Hormuz reopening. It was Goldman's second downward revision to its oil price forecasts in a week.</p><p class="font-claude-response-body break-words whitespace-normal">China's data gave markets more to digest. Industrial output rose a stronger-than-expected 4.5% in May, buoyed by AI-driven export demand, but retail sales fell 0.6% year on year, their first decline since the pandemic. Fixed asset investment contracted 4.1% in the year to date, well below forecasts, and property investment extended its deterioration with new home prices falling at a slightly faster monthly pace. Larger cities showed tentative signs of stabilisation but the broader sector remains under pressure from weak household borrowing appetite and subdued consumer confidence. </p> This article was written by Eamonn Sheridan at investinglive.com.

<p class="font-claude-response-body break-words whitespace-normal"><a href="https://investinglive.com/news/china-data-may-2026-industrial-output-45-yy-expected-42-20260616/" target="_blank" rel="follow">The data</a> reinforces a China growth narrative that is increasingly uncomfortable for commodity and consumer-facing markets. The retail sales miss, the first contraction since December 2022, is not a rounding error and points to a domestic demand problem that government trade-in schemes and holiday spending have failed to arrest. Fixed asset investment falling more than twice as fast as expected compounds the concern. For oil and industrial metals, the consumption-side weakness is a headwind even as the AI-driven export surge flatters the headline. The property sector remains the structural drag, with investment down 16.2% in the year to date and new home prices still falling. The unemployment rate ticking down to 5.1% is a rare positive but is complicated by rising anxiety around AI-driven job displacement, which may itself be suppressing household confidence and borrowing appetite.</p><p class="font-claude-response-body break-words whitespace-normal">--</p><p class="font-claude-response-body break-words whitespace-normal"> China's May data showed industrial output beating expectations at 4.5% but retail sales falling 0.6%, the first decline since the pandemic, as domestic demand and fixed asset investment deteriorated sharply. </p><p class="font-claude-response-body break-words whitespace-normal">Summary: Source: China National Bureau of Statistics, via Reuters</p><ul class="[li_&amp;]:mb-0 [li_&amp;]:mt-1 [li_&amp;]:gap-1 [&amp;:not(:last-child)_ul]:pb-1 [&amp;:not(:last-child)_ol]:pb-1 list-disc flex flex-col gap-1 pl-8 mb-3"><li class="font-claude-response-body whitespace-normal break-words pl-2">Industrial production rose 4.5% year on year in May, above the 4.2% forecast and April's 4.1%, driven in part by a surge in AI-related manufacturing and export demand</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Retail sales fell 0.6% year on year, the first decline since December 2022, missing the flat 0.0% consensus and reversing April's 0.2% gain; even the five-day Labour Day holiday failed to lift consumer activity</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Fixed asset investment contracted 4.1% in the year to date through May, significantly worse than the expected 2.0% decline and accelerating from the 1.6% fall recorded through April</li><li class="font-claude-response-body whitespace-normal break-words pl-2">Property investment fell 16.2% in the first five months of the year, deepening from a 13.7% decline in the January-April period; new home prices fell at a slightly faster monthly pace in May</li><li class="font-claude-response-body whitespace-normal break-words pl-2">The surveyed unemployment rate eased to 5.1% from 5.2%, the sole positive in the release, though worker anxiety around AI-driven job displacement is cited as a factor weighing on household confidence and borrowing</li><li class="font-claude-response-body whitespace-normal break-words pl-2">A 19.4% export gain and factory-gate inflation rising to its highest since July 2022 contrast sharply with stagnant consumer inflation, illustrating the widening gap between supply-side momentum and domestic demand</li></ul><p class="font-claude-response-body break-words whitespace-normal"> China's May economic data delivered a sharply mixed picture, with industrial output accelerating beyond expectations while retail sales posted their first annual decline since the depths of the pandemic, underscoring a two-speed economy in which export and manufacturing strength is increasingly decoupled from domestic consumption.</p><p class="font-claude-response-body break-words whitespace-normal">Industrial production rose 4.5% from a year earlier, ahead of the 4.2% forecast and picking up from April's 4.1% reading. A global surge in AI-related investment has provided China's manufacturing sector with an unexpected buffer against the export disruption many had anticipated from Middle East turmoil, with export growth running at 19.4% year on year. That external momentum has not, however, translated into domestic spending. Retail sales fell 0.6% in May, reversing April's modest 0.2% gain and coming in well below consensus expectations of a flat reading. It was the weakest consumer outcome since December 2022, and notably occurred despite a five-day Labour Day holiday period. The government's consumer goods trade-in programme, which had provided some earlier support, appears to be fading as a stimulus.</p><p class="font-claude-response-body break-words whitespace-normal">The investment picture was worse than anticipated. Fixed asset investment contracted 4.1% in the first five months of the year, more than double the 2.0% decline forecast and accelerating from the 1.6% fall recorded through April. Property investment extended its deterioration, dropping 16.2% in the year to date after a 13.7% decline in the prior period, with new home prices also falling at a slightly faster monthly pace. Weak household loan data released last week pointed to continued reluctance among consumers to borrow for property purchases amid sluggish income growth and job insecurity.</p><p class="font-claude-response-body break-words whitespace-normal">The price data added to the imbalance picture. Factory-gate inflation climbed to its highest level since July 2022 while consumer inflation remained stagnant, a divergence that reflects demand failing to keep pace with supply-side expansion. The surveyed unemployment rate eased marginally to 5.1% from 5.2%, though analysts note that anxiety around AI-driven job displacement is weighing on worker confidence and may be suppressing consumption independently of the property downturn.</p> This article was written by Eamonn Sheridan at investinglive.com.

<p>May month data from China. </p><p>Industrial Production 4.5% y/y </p><ul><li>expected 4.2%, prior 4.1%</li></ul><p>Retail Sales -0.6% y/y, first decline since the pandemic</p><ul><li>expected flat at 0%, prior 0.2%</li></ul><p>Fixed Asset Investment (YTD) -4.1% y/y</p><ul><li>expected -2%, prior -1.6%,</li></ul><p>Unemployment Rate 5.1%</p><ul><li>expected 5.2%, prior 5.2%</li></ul><p>I'll have more to come on this separately </p><p>-</p><p>Earlier:</p><ul><li><a href="https://investinglive.com/news/china-house-prices-may-2026-35-yy-prior-35-20260616/" target="_blank" rel="follow" data-article-link="true">China house prices May 2026 -3.5% y/y (prior -3.5%)</a></li></ul> This article was written by Eamonn Sheridan at investinglive.com.