Asian Markets Stall as Wall Street Extends Gains, Trump’s New Tariffs Trigger Regional Unease

MUFG, Japan's largest financial group, is entering an aggressive phase in its global strategy by scaling up its securitisation operations, especially in North America. According to Fumitaka Nakahama, head of the global corporate and investment banking business group, MUFG plans to increase its securitisation headcount from 80 to over 100 by early next fiscal year. This expansion marks a deliberate pivot from its previously cautious approach, signaling a broader ambition to boost its global influence in structured finance.

The bank, already active in securitised products tied to credit card receivables and auto loans, is seeking to diversify into non-traditional asset classes that offer higher margins and lower competition. Among the most promising: data centers, which are gaining momentum thanks to the rising global demand for generative AI infrastructure.

Nakahama highlighted that the group is launching new securitised products such as collateralised loan obligations (CLOs) based on project finance assets, particularly for data centers. This focus reflects a unique strategy to merge the bank's strength in project finance where MUFG has dominated U.S. rankings for 15 consecutive years with structured credit instruments.

The pivot toward data centers is also designed to sidestep geopolitical risks. Nakahama noted that U.S. data centers aimed at domestic demand remain insulated from President Trump’s escalating tariff measures, giving MUFG a degree of protection from potential disruptions in global trade.

By blending traditional project finance with securitisation, MUFG aims to establish a niche that sets it apart from competitors crowding the more liquid and lower-margin asset classes. This approach is expected to lift the division's return on equity (ROE) to double digits over the medium to long term, a key target reflecting both operational discipline and investor appeal.

The expansion aligns with MUFG’s broader U.S. strategy, following its divestment of Union Bank’s retail division three years ago. That move was intended to sharpen focus on institutional lending and securitised products areas now seen as critical to growth under volatile macroeconomic conditions.

Investing in talent is central to this strategy. By increasing securitisation staff by around 25%, MUFG is ensuring it has the manpower to handle more complex deals, particularly those involving hybrid structures that combine infrastructure assets with capital markets funding.

Nakahama’s assertion that this is a “phase to go on the offensive” indicates the bank’s growing confidence in a climate where demand for secure, yield-generating products remains strong despite global financial uncertainties.

MUFG’s securitisation expansion in the U.S. is more than just a geographic push it’s a calculated repositioning toward resilient, technology-linked asset classes that align with global megatrends. By fusing project finance with structured credit innovation and strategically avoiding politically sensitive trade sectors, MUFG is positioning itself for sustained profitability and strategic leadership in an increasingly fragmented financial world.

China's ambitious effort to reinvigorate domestic consumption through aggressive consumer lending policies is running into significant obstacles. Since March, financial regulators have pressured banks to offer more personal loans at reduced rates to offset the impact of escalating U.S. tariffs. However, the initiative has backfired in many cases, as lenders confront a growing backlog of non-performing loans (NPLs) and a shortage of qualified or willing borrowers.

Initially, banks responded by slashing interest rates on consumer loans to below 3%, but quickly reversed course when profit margins shrank and risk exposure climbed. While consumer loan volumes still grew 6.1% in Q1 2025, this pace marked a notable deceleration compared to the same periods in 2024 and 2023. The central contradiction now facing the financial system lies in its mandate to spur credit growth, despite worsening borrower quality and mounting credit losses.

One of the most alarming developments is the rise in bad loans. Although China's official overall NPL ratio for commercial banks stood relatively stable at 1.51% as of March, these aggregate figures obscure the severity of consumer credit deterioration. Industry insiders report a steep increase in defaults on personal loans, a trend reflected in the 190% year-on-year jump in NPLs offered for sale by banks during Q1 2025 roughly 70% of which were personal loans.

Top-tier banks are not immune. The Industrial and Commercial Bank of China (ICBC) saw its consumer NPL ratio rise from 1.34% to 2.39% in a year. Regional lenders face even more distress: Bohai Bank’s ratio jumped from 4.44% to 12.37%, and Harbin Bank saw a rise from 3.94% to 5.51%. These spikes underscore the growing fragility of consumer balance sheets, particularly in regions hit hardest by job losses and industrial slowdown tied to trade frictions.

The broader context reveals a more structural problem: consumer pessimism. Beijing’s debt-fueled strategy collides with households’ increasingly conservative financial behavior. Central bank surveys show that 61.4% of households prefer to boost savings rather than spend or borrow, reflecting a nearly 20-point increase in savings intent since before the COVID-19 pandemic.

This restraint stems not only from rising defaults but also from falling household income. Widespread wage cuts in the financial sector, manufacturing, and state-owned enterprises combined with growing concerns over job security due to Trump-era tariffs have made borrowers more risk-averse. In many cases, even those eligible for cheap credit are unwilling to take it on, reflecting a loss of confidence in short-term economic stability.

Chinese loan officers now face intense pressure to meet lending targets imposed by regulators. Some have reportedly resorted to borrowing from peer banks to artificially fulfill quotas highlighting systemic distortions driven by top-down policy mandates. Simultaneously, bank managers are increasingly prioritizing NPL write-offs over issuing fresh credit, signaling growing awareness that reckless lending may trigger a deeper financial crisis.

The long-term consequence of such contradictions is a further erosion of market confidence. While policymakers might see consumer credit as a quick fix, analysts like ING’s Lynn Song argue that only income-driven consumption can create sustainable economic recovery. Without meaningful gains in employment, wages, and social welfare support, consumption stimulus via lending will likely prove temporary and fragile.

Beijing’s push to revive the economy via consumer lending has encountered the limits of household balance sheets and sentiment. As defaults climb and loan demand dries up, Chinese banks are forced into a dangerous balancing act: grow their lending books without exacerbating financial instability. Without addressing the root cause stagnant income growth and economic insecurity China risks compounding its slowdown with a credit quality crisis, further complicating its battle against both domestic malaise and global trade headwinds.

1. Israeli Prime Minister considers ending Gaza Conflict after 60-day temporary ceasefire.

2. Brazil to return Trump’s tariff letter and summon U.S. Chargé d'Affaires.

3. Trump may use Presidential Authority to send weapons to Ukraine.

4. Fed Governor Waller advocates for July rate cut.

5. Partial Iranian enriched Uranium survives U.S.-Israel airstrikes.

6. Zelensky: No Russia-Ukraine talks for now, considering reassigning Defense Minister as U.S. Ambassador.

7. EU proposes floating price cap on Russian oil.

8. Trump: 35% tariff on Canadian imports effective August 1st.

A statement from the Israeli Prime Minister's Office revealed that during a meeting, Netanyahu stated he had "discussed in detail" the issue of detainees with U.S. President Trump in their previous talks. Israeli media, citing sources present at the meeting, reported that Netanyahu said it was "impossible" to reach a comprehensive ceasefire agreement at this stage, but Israel is making efforts toward this goal and considering ending the Gaza conflict after achieving a 60-day temporary ceasefire.

In response to U.S. President Trump's imposing a 50% tariff on Brazilian goods starting August 1st, Brazil's Minister of Agriculture and Livestock, Carlos Fávaro, stated on the afternoon of July 10th that the U.S. government's move was an "unjustified measure." Fávaro emphasized that Brazil would focus on key markets with significant consumption potential, such as the Middle East and South Asia, as alternative export destinations. On July 9th, the Brazilian government announced it had informed the U.S. Embassy of its decision to return the letter sent by President Trump that day and would summon U.S. Chargé d'Affaires in Brazil, Escobar, to explain the contents of the letter regarding former President Bolsonaro.

Reports indicate that Trump plans to utilize the same presidential authority previously employed by Biden to deliver U.S. weapons to Ukraine, marking his first such action since returning to the White House. The weapons, valued at approximately $300 million, will be drawn from U.S. stockpiles under the Presidential Drawdown Authority. A final decision on the specific equipment, which may include Patriot missiles and medium-range rockets, is expected soon.

Federal Reserve Governor Christopher Waller stated on Thursday local time that the Fed should consider cutting interest rates at its July policy meeting, even after strong June employment data. During a Q&A session following a speech at the Dallas Fed, he emphasized, "I just made the argument. I think we're in the position that we could do this as early as July." Waller argued that inflation has notably cooled, the labor market has stabilized, and recent tariff-driven price increases are limited to specific goods. He insisted that the Fed should not maintain such a restrictive policy stance when inflation is declining. Such a remark stood out not only for their timing, coming just after the latest jobs report showed continued labor market strength, but also because he is seen as a leading candidate to succeed Fed Chair Jerome Powell. President Trump has repeatedly criticized Powell and urged him to step down early, while Waller, known for his dovish stance, is viewed as a potential successor. However, he also emphasized "it's not political", saying his position was grounded in economics while he is in the minority.

According to reports, a senior Israeli official revealed that Israel's assessment indicates some near-weapons-grade enriched uranium stored underground in Iran survived last month's joint U.S.-Israel airstrikes. These nuclear materials may still be accessible to Iranian nuclear engineers. The anonymous official stated that Israel had detected signs of Iran secretly accelerating its nuclear weapons development as early as late last year, prompting preparations for military action. The report noted that shortly after the Israeli Air Force killed Lebanese Hezbollah leader Hassan Nasrallah, Israeli intelligence identified Iranian nuclear weapons activities. This discovery led Prime Minister Benjamin Netanyahu to formulate an "independent action" plan. Notably, during the mid-June Israeli strikes on Iran and Trump's decision to join the operation, U.S. intelligence officials claimed there was no evidence of Iran weaponizing enriched uranium.

On July 10th local time, Ukrainian President Zelensky stated in an interview that negotiations between Russia and Ukraine would not occur temporarily, as the agreed prisoner exchange had not yet been completed. Zelensky also mentioned he was considering reassigning current Defense Minister Rustem Umerov as Ukraine's ambassador to the United States. He emphasized that Ukraine would certainly replace its ambassador to the U.S. soon. That same day, Zelensky added that after a constructive and positive dialogue with U.S. President Donald Trump, Ukraine had received all necessary political signals, with all indications pointing to the resumption of U.S. aid supplies. "We have reached agreements on all these issues," he stressed. Regarding the supply of Patriot air defense systems, Zelensky said discussions with Trump were productive. Ukraine has requested Patriot systems and accompanying missiles, with Germany offering to procure two sets and Norway one.

Four EU diplomats revealed that the European Commission will propose a floating price cap mechanism for Russian oil this week as part of a new sanctions package, aiming to overcome opposition from some member states. In June, the Commission had suggested lowering the G7-imposed 60−per−barrel price cap on Russian oil to 45 in its 18th sanctions package. The G7 initially established the cap in December 2022 to curb Russia's ability to finance its war in Ukraine. The proposed adjustment stems from declining global oil prices, which have rendered the current cap ineffective. According to four EU sources, the Commission is drafting a mechanism to dynamically adjust the cap based on global oil market fluctuations. One official noted the proposal is still being refined, with plans to automate price reviews to align with international benchmarks.

U.S. President Donald Trump announced on Truth Social that a 35% tariff would be imposed on Canadian goods. In a letter to Canadian Prime Minister Carrie Kan, Trump stated: "starting August 1, 2025, we will charge Canada a Tariff of 35% on Canadian products sent into the United States, separate from all Sectoral Tariffs." "Goods transshipped to evade this higher Tariff will be subject to that higher Tariff. As you are aware, there will be no Tariff if Canada, or companies within your Country, decide to build or manufacture product within the United States and, in fact, we will do everything possible to get approvals quickly, professionally, and routinely-In other words, in a matter of weeks," If Canadian or your domestic businesses choose to establish production facilities in the U.S., we will expedite approvals—typically within weeks. Should Canada retaliate with tariff hikes, the U.S. will proportionally increase its 35% tariff." In the letter, Trump threatened to increase the tariff rate by the same amount if Canada decides to increase their tariffs on importing American products.

In the letter, Trump wrote, "I must mention that the flow of Fentanyl is hardly the only challenge we have with Canada, which has many Tariff, and Non-Tariff, Policies and Trade Barriers, which cause unsustainable Trade Deficits against the United States. Canada charges extraordinary Tariffs to our Dairy Farmers up to 400%-and that is even assuming our Dairy Farmers even have access to sell their products to the people of Canada. The Trade Deficit is a major threat to our Economy and, indeed, our National Security." "If Canada works with me to stop the flow of Fentanyl, we will, perhaps, consider an adjustment to this letter. These Tariffs may be modified, upward or downward, depending on our relationship with your Country.

UTC+8 14:00 UK 3-Month GDP MoM (May)

UTC+8 20:30 Canada Employment Change (June)​

UTC+8 02:30 Speech by SF Fed President Daly

UTC+8 16:00 IEA Monthly Oil Market Report Release

The cryptocurrency market is experiencing one of its most powerful rallies of 2025. According to CoinMarketCap data on the morning of July 11, total market capitalization has surpassed $3.64 trillion, a 4.92% increase in just 24 hours and the highest level ever recorded. The rally spans across all asset classes, from leading coins like Bitcoin and Ethereum to a wide array of altcoins, driven by surging liquidity and a sharp influx of capital from both retail and institutional investors.

Bitcoin (BTC) officially set a new all-time high (ATH) on July 11 by crossing $116,000 for the first time, exceeding the critical psychological level of $115,000. Over the past 24 hours, BTC has traded within the $108,503 to $116,000 range, gaining over 5.6% and spearheading the bullish sentiment throughout the digital asset ecosystem.

Several factors have converged to fuel investor optimism: expectations of stable monetary policy from the Federal Reserve, consistent capital inflows into spot Bitcoin ETFs in the U.S., and a surge in global exchange liquidity. Binance, the world's largest crypto exchange, remains the epicenter of this liquidity boom, with significant volume increases in key pairs like BTC/USDT and ETH/USDT. As of this morning's session close, total market trading volume exceeded $200 trillion, a 45% jump in 24 hours, signaling strong investor participation.

The bullish momentum is not limited to Bitcoin. A wave of altcoins has posted extraordinary gains, quickly capturing global investor attention. Leading the charge is HYPER, which skyrocketed by 300% in 24 hours, followed by PENGU, up 32% on the back of a creative marketing campaign and new product launch. BANANAS31 surged 107%, ranking among the highest-volume tokens traded on Binance on July 10.

The rally among small- and mid-cap altcoins has ignited hopes of a fresh altseason a cyclical period when altcoins outperform Bitcoin as capital rotates in search of higher returns. Social media platforms and crypto communities have seen a sharp spike in search interest and discussions around tokens like HYPER, PENGU, and BANANAS31, underscoring a rising wave of FOMO (Fear of Missing Out) among both retail and institutional players.

This emotional shift in investor sentiment has significantly amplified market liquidity, which has reached its highest point in months. The parabolic growth across multiple crypto segments reflects not only bullish technical setups but also a broader return of confidence in digital assets amid global economic uncertainty.

The cryptocurrency market's explosive breakout past the $3.64 trillion mark, led by Bitcoin’s historic ascent to $116,000, underscores a reinvigorated appetite for digital assets in 2025. While macroeconomic stability and regulatory shifts continue to shape the broader landscape, the convergence of liquidity, investor enthusiasm, and strong altcoin performance signals the beginning of a potentially sustained bull cycle one that could redefine the digital economy's trajectory in the months ahead.

In a closed-door session at the Allen & Co. conference an annual gathering of global business elites Treasury Secretary Scott Bessent surprised attendees by likening Donald Trump’s negotiation temperament to that of George Soros, his former employer. According to insiders, Bessent highlighted the impatience and high standards shared by both men when dealing with critical financial and political decisions.

Despite their opposing political ideologies, Bessent noted that both figures demand swift action and measurable results. His comments came as he addressed questions about how he manages expectations in the Trump administration, especially around the timing and rollout of trade announcements. While praising Trump’s instincts for identifying economic problems, Bessent admitted the president often seeks rapid implementation, which can complicate longer-term strategy.

Bessent sought to temper concerns about rising inflation, despite the latest round of tariffs on allies like Canada and Brazil. He told attendees that the inflationary impact of Trump’s aggressive tariff regime was overstated and that markets were misreading the situation. He predicted two rate cuts by the Federal Reserve in 2025, aligning long-term interest rates back to pre-pandemic norms.

According to Bessent, investor sentiment has already priced in one and a half cuts, a nod to resilient economic data and tempered inflation expectations. His forecast, however, contradicts the Fed’s current cautious tone, especially amid persistent White House pressure to lower rates and increasing political tension between Trump and Fed Chair Jerome Powell.

Trump’s recent wave of tariff announcements most notably a 35% duty on Canadian goods and a surprising 50% tariff on Brazilian imports has rattled markets and left trade partners scrambling to negotiate exemptions. The administration’s approach has shifted from bilateral diplomacy to unilateral declarations via presidential letters, effectively sidelining conventional trade frameworks.

Bessent, playing a dual role as both Treasury Secretary and lead trade negotiator, remains at the center of these negotiations. He is scheduled to travel to Japan and meet with officials from China and Indonesia in the coming weeks. Despite public denials that trade will be a formal topic, insiders suggest backchannel talks are likely as trading partners race to reach deals before the August 1 tariff implementation deadline.

U.S.-China trade relations remain strained. After tariffs on Chinese goods peaked at 145% earlier this year, Bessent and U.S. Trade Representative Jamieson Greer helped establish a fragile truce during meetings in Geneva and London. These summits reaffirmed the need for continued negotiations but fell short of delivering a binding trade agreement.

While Commerce Secretary Howard Lutnick joined the discussions to lend weight, the Trump administration continues to use tariffs as a pressure tool. Bessent rejected media labels such as “TACO” (“Trump Always Chickens Out”), instead asserting that Trump’s strategy resembles “FAFO” (“F Around and Find Out”), reflecting his willingness to escalate until results are secured.

Bessent didn’t shy away from interpersonal tensions within the broader Trump orbit. When asked about Elon Musk’s rumored political ambitions, Bessent dismissed the idea with a jab, saying Musk might garner support “on Mars.” The remark, though lighthearted, underscores a deeper friction between the Treasury chief and the Tesla/SpaceX CEO, whose interests increasingly intersect with government policy.

Bessent’s remarks in Sun Valley illuminate the inner dynamics shaping U.S. economic and trade policy under Trump’s second term. As a strategist balancing market expectations, trade friction, and political volatility, Bessent is positioning himself as both an architect of Trump’s bold trade tactics and a stabilizing voice forecasting lower rates. With major deadlines looming and diplomatic channels strained, the coming weeks may test just how far Trump’s impatience and Bessent’s diplomacy can push the global economic order.

As Washington’s tariff assault intensifies, top Chinese economists including People’s Bank of China (PBOC) monetary policy adviser Huang Yiping have urged Beijing to roll out 1 to 1.5 trillion yuan in stimulus over the next year. The proposal significantly exceeds the current 300 billion yuan in ultra-long bond-financed consumer subsidies, reflecting growing alarm over the economic drag caused by U.S. President Donald Trump’s trade policies.

According to the report, which also includes contributions from Guo Kai (former PBOC official) and Alfred Schipke (National University of Singapore), China faces “new disruptions” since U.S. tariffs were raised in April. These disruptions compound already fragile conditions caused by deflationary pressures, sluggish domestic consumption, and a faltering real estate market.

The authors argue that bolstering household spending is the most effective buffer against the estimated 20%–30% tariff burden on Chinese exports. Stimulating demand domestically could help China pivot away from overdependence on global trade, especially with U.S. scrutiny tightening over re-routed shipments from intermediary countries.

At the same time, the report emphasizes the need for greater yuan flexibility to absorb external shocks. With global capital flows and trade expectations highly volatile, the exchange rate must be used as a stabilizer not a rigid political tool. This approach contrasts with Beijing’s earlier stance of tightly managing the yuan’s value to maintain financial stability.

To reinforce the short-term stimulus, the report also suggests that the PBOC should further reduce policy interest rates and push banks to cut Loan Prime Rates (LPR), improving access to cheaper credit and encouraging investment. Huang and his colleagues argue that raising nominal growth expectations is crucial to support corporate profits and prevent deflation from taking hold.

Looking ahead, the report proposes broad fiscal reforms, including expanding the personal income tax base and simplifying value-added tax (VAT) structures. These adjustments are meant to solidify the government’s long-term fiscal position while reducing reliance on volatile external trade flows.

A striking point raised in the analysis is the ballooning debt exposure to small and medium-sized enterprises (SMEs), which now represents over 60% of China’s GDP, up from 37% in 2019. This surpasses even the well-documented risks from local government financing vehicles. The report warns that unless these credit exposures are managed, banks will face constraints in supporting more productive sectors, which are essential for innovation and growth.

In essence, the $209 billion stimulus recommendation reflects a broader shift in China’s macroeconomic strategy. With the U.S. trade environment deteriorating and internal growth engines faltering, Beijing may be forced to walk a tightrope between aggressive short-term stimulus and deeper structural reform. If implemented wisely, the package could cushion the economy through the tariff storm but it also underscores how significantly external shocks are now dictating the trajectory of Chinese policymaking.