The Wealth Effect and Consumer Spending: A Tighter Feedback Loop

Demographic and Technological Reinforcement of the Wealth Channel

Artificial Intelligence and the Market’s Consumption Boost

Rising Inequality and the K-Shaped Economy

The Feedback Between Fiscal and Monetary Tools and Asset Prices

Source: The Fortune

Soybeans extended gains after the US said China agreed to halt retaliatory tariffs following a key summit last week, and reiterated the Asian nation will ramp up purchases this year.

China will suspend all levies announced since March 4 on soybeans and other US agricultural products including corn, wheat, sorghum and chicken, according to a fact sheet released by the White House on Saturday. Beijing is yet to confirm the halt, and didn't directly address a question on the duties last week.

The White House added that China agreed to purchase at least 12 million tons of US soybeans by the end of the year, and at least 25 million tons annually over next three years. Agriculture Secretary Brooke Rollins first flagged the volumes last week after the summit ended without those details.

The US statement is the most detailed account yet of the trade deal following a meeting between President Donald Trump and his Chinese counterpart Xi Jinping in South Korea. The pact has fueled optimism that agricultural trade between the two giants, particularly soybeans, could return to normal levels.

China had shunned US soybeans as tensions between the two nations soured, taking more from South American producers. Just days before the meeting, China bought its first US cargoes, following up with further purchases after the summit. The trade was worth more than $12 billion last year.

However, even with the removal of the retaliatory tariffs, US cargoes will still incur duties of 13%, making them uncompetitive with Brazil, traders said.

Source: Bloomberg Europe

Malaysia's manufacturing sector conditions softened at the start of the final quarter of 2025, with the S&P Global Malaysia Manufacturing Purchasing Managers' Index (PMI) falling to 49.5 in October from 49.8 in September.

The latest reading, which came in marginally below the neutral 50.0 threshold, marked a four-month low for the index, indicating further moderation in business conditions.

New orders declined for the first time in three months, though only fractionally, as firms reported weak market activity and subdued client confidence. New export orders fell at the steepest rate since April, with manufacturers citing muted sales particularly to Asia-Pacific and Africa regions.

Production levels were scaled back at a more pronounced rate in October as companies responded to lower order volumes. The reduction rate was mild but represented the steepest decline in five months.

Employment decreased marginally, marking the fourth consecutive month of workforce reduction. Despite this, manufacturers were able to reduce backlogs of work at the sharpest pace since February due to moderated demand.

On the price front, input cost inflation strengthened slightly from September but remained modest overall. Firms chose to lower their selling prices for the first time in six months in an attempt to stimulate sales.

Supply chain pressures continued as supplier delivery times lengthened for the second consecutive month, with companies reporting shipping delays and material shortages.

Despite the challenging conditions, business confidence improved significantly, reaching its highest level since April 2023. Manufacturers expressed optimism that new orders would expand in the coming year, leading to higher output.

According to S&P Global, the latest PMI reading suggests that both GDP and official manufacturing production increased solidly on an annual basis at the start of the final quarter of the year, based on historical relationships between PMI data and official output figures.

Source: Investing

Denmark, which holds the European Council presidency, has reportedly withdrawn the proposal that would have forced platforms like Telegram, WhatsApp and Signal to allow authorities to screen messages before they're encrypted and sent.

The proposed legislation, known as the Chat Control law, was first introduced in May 2022 as a method to combat the spread of illicit and illegal content through messaging services.

A revived version of it came up this year, with critics arguing again that it would undermine encrypted messaging and people's right to privacy.

The withdrawn proposal means it will remain voluntary.

Minister of Justice Peter Hummelgaard stated that the proposal will now "not be part of the EU presidency's new compromise proposal, and that it will continue to be voluntary," for tech giants to screen encrypted messages, according to a report by Danish daily newspaper Politiken on Oct. 30.

Current framework expires in April

The current voluntary framework expires in April 2026, and Politiken reported that Hummelgaard stated that if the years-long political stalemate over Chat Control were not resolved, it would leave the EU without any legal tools to combat bad actors using messaging services.

The backtrack on chat control was reportedly to ensure a new framework could be implemented before the deadline.

Tech giants and privacy advocates celebrate

X's Global Government Affairs team said on Saturday that Denmark's withdrawal is a "major defeat for mass surveillance advocates," and the platform will "continue to monitor the progress of these negotiations and oppose any efforts to implement government mass surveillance of users."

Source: X Global Government Affairs

Patrick Hansen, the director of EU Strategy and Policy at stablecoin issuer Circle, also applauded the news and stated it was a "Major win for digital freedoms in the EU."

The Electronic Frontier Foundation (EFF), a civil liberty nonprofit, shared a similar stance and speculated public pressure "pushed the EU Council to withdraw its dangerous plan to scan encrypted messages."

Lawmakers need to give up on mass surveillance

Thorin Klosowski, a security and privacy activist with the EFF, said in a blog post on Friday that lawmakers should stop attempting to bypass encryption under the guise of public safety.

He argues that the focus should be on "developing real solutions that don't violate the human rights of people around the world."

"As long as lawmakers continue to misunderstand the way encryption technology works, there is no way forward with message-scanning proposals, not in the EU or anywhere else," he said.

Ireland will assume the EU Council's presidency in July 2026, taking the reins from Denmark after a year in the role.

Source: COINTELEGRAPH

Thailand's manufacturing sector expansion accelerated in October, reaching its fastest pace since May 2023, according to the latest S&P Global Thailand Manufacturing PMI data.

The headline PMI rose to 56.6 in October from 54.6 in September, marking the sixth consecutive month above the 50.0 neutral mark. This indicates a significant improvement in manufacturing conditions.

New orders increased at the steepest rate in two-and-a-half years, driven by successful business development and rising client interest. While external demand continued to decline, the fall in new export orders was only marginal and less severe than in September.

Production growth accelerated for the seventh consecutive month in response to rising new work. Thai manufacturers increased their workforce capacity for the second straight month to manage growing workloads.

Despite these efforts, backlogs accumulated at a survey record pace, and finished goods inventories declined for the fifth consecutive month as companies fulfilled orders.

Purchasing activity expanded in October, though stocks of purchases continued to decline due to high utilization of input products and shipment delays as lead times lengthened.

On the pricing front, average input costs stabilized after three consecutive months of decline, leading manufacturers to keep their selling prices unchanged at the start of the fourth quarter.

Business confidence improved to its highest level in two-and-a-half years, supported by hopes for business expansion plans and better economic conditions to drive sales in the coming year.

Jingyi Pan, Economics Associate Director at S&P Global Market Intelligence, noted that manufacturing output rose at the quickest pace in nearly two-and-a-half years, primarily driven by robust domestic demand.

Pan added that forward-looking indicators present a positive outlook for near-term output growth, suggesting the Thai manufacturing sector remains on track for continued growth in the coming months.

Source: Investing

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Commodities and Currency Markets Remain Steady

Source: AP