Gold Holds Drop As US-EU Trade Deal Provides Boost For Dollar

Summary:

Gold held a decline after the dollar rose the most since May following a tariff deal between the US and the European Union, with investors now focusing on prospects for an extension of a trade truce between Washington and Beijing.

Bullion traded near $3,312 an ounce, following a 0.7% decline on Monday. The greenback jumped — putting it on track for its first monthly gain this year — and the euro sank amid renewed fears that 15% duties on European exports may impact global growth. A stronger dollar makes gold more expensive for most buyers.

Investors were also monitoring talks between the US and China in Stockholm, as Commerce Secretary Howard Lutnick said a 90-day extension of an earlier trade truce was a “likely outcome.” With President Donald Trump’s Aug. 1 tariff deadline fast approaching, several other trading partners — including South Korea and Brazil — are still racing to secure agreements.

Gold is up by more than a quarter this year, with uncertainty around Trump’s aggressive attempts to reshape global trade, along with conflicts in Ukraine and the Middle East, spurring a flight to safety. Still, the precious metal has been trading within a tight range over the past few months after spiking to an all-time high above $3,500 an ounce in April.

Spot gold was down 0.1% to $3,312.07 an ounce at 8 a.m. in Singapore. The Bloomberg Dollar Spot Index was steady, following a 0.8% gain in the previous session. Silver was flat, while platinum and palladium rose.

Investors will this week be parsing through a raft of key data from jobs to inflation and economic activity, while the Federal Reserve is expected to keep rates unchanged. Lower borrowing costs tend to benefit bullion, as it doesn’t pay interest.

Source: Bloomberg Europe

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Hannah Ellis

Oil extended gains on Tuesday, lifted by hopes of improved economic activity after the U.S.-EU trade deal, a potential U.S.-China tariff truce and President Donald Trump's shorter deadline for Russia to end the Ukraine war.

Brent crude futures were up 24 cents, or 0.34%, to $70.28 a barrel by 0000 GMT, while U.S. West Texas Intermediate crude was at $66.93 a barrel, up 22 cents, or 0.33%.

Both contracts settled more than 2% higher in the previous session, and Brent touched its highest level since July 18 on Monday.

The trade agreement between the United States and the European Union, while imposing a 15% import tariff on most EU goods, sidestepped a full-blown trade war between the two major allies that would have rippled across nearly a third of global trade and dimmed the outlook for fuel demand.

Oil prices were also supported by news of a possible extension of the trade truce between the U.S. and China, with top economic officials from both countries having met in Stockholm on Monday for more than five hours of talks. The discussions are expected to resume on Tuesday.

Meanwhile, Trump set a new deadline on Monday of "10 or 12 days" for Russia to make progress toward ending the war in Ukraine or face sanctions. Trump has threatened sanctions on both Russia and buyers of its exports unless progress is made.

"Trump's comments reignited fears that Russia's oil flows would be impacted," ANZ senior commodity strategist Daniel Hynes wrote in a note.

"This also comes on the back of the latest sanctions package by the EU against Russia, including a lower price cap on the country's crude and the import of refined products made from Moscow's oil in other countries," Hynes added.

Source: Yahoo Finance

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Samantha Luan

Cryptocurrency

Economic

● Bitcoin pumped after 5 of last 7 Fed meetings

● Traders eye potential breakout this Wednesday

● Outcome may matter less than market sentiment

Bitcoin’s Fed Day Rally: Can It Happen Again?

Bitcoin traders are once again looking toward the Federal Reserve with optimism. Historically, the Bitcoin Fed meeting trend has shown strength: in 5 of the last 7 FOMC (Federal Open Market Committee) decisions, Bitcoin has rallied—regardless of the outcome.

Bitcoin Eyes Gains Ahead Of Fed Meeting_1

Whether the Fed hiked rates, held steady, or pivoted its tone, Bitcoin managed to climb, powered by traders capitalizing on macro volatility and forward-looking sentiment.This Wednesday, all eyes are back on the central bank. While no drastic rate changes are expected, traders are closely watching Fed Chair Jerome Powell’s comments, which often drive market psychology more than the actual policy decision.FED meeting this Wednesday.Bitcoin pumped 5 out of the last 7 times, regardless of the outcome.

Why Bitcoin Tends to React Strongly

The correlation between Bitcoin and Fed meetings isn’t about the rate decision alone—it’s about uncertainty resolution. Leading up to each meeting, markets often grow nervous. Once the announcement hits, even a predictable outcome brings clarity and often fuels risk-on assets like crypto.For the crypto market, that relief can mean a surge in buying activity. With inflation appearing under control and no major surprises forecasted, the stage may be set for another Bitcoin breakout—just as it’s done multiple times before.

Market Sentiment Points to a Bullish Bias

Social media buzz and trading activity are already building ahead of Wednesday’s Fed meeting. If the trend holds, Bitcoin could see another notable move, potentially igniting broader altcoin momentum as well.While history doesn’t guarantee future results, crypto traders are ready. And if Bitcoin follows its recent Fed-day track record, we could see another rocketin motion.

Source: CryptoSlate

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Henry Thompson

Oil held a gain after President Donald Trump pushed for Russia to reach a swift truce with Ukraine or face potential economic penalties, raising concerns crude supplies from the OPEC+ producer could be disrupted.

West Texas Intermediate was around $67 a barrel after closing 2.4% higher on Monday. Brent settled near $70. Trump said he would impose a new deadline of 10-12 days for Moscow to reach a ceasefire, warning of “secondary sanctions,” he said on Monday. The president initially gave Russia 50 days for a truce.

Trump’s action follows the latest round of sanctions by the European Union on Russia, which included penalties on India’s Nayara Energy. Global markets are also focused on the US deadline for trade deals by Aug. 1, and the upcoming OPEC+ meeting that will decide supply policy for September.

Source: Yahoo Finance

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James Whitman

Central Bank

Political

A federal judge in Washington denied a request by an investment firm led by an ally of President Donald Trump for public access to Tuesday’s Federal Open Market Committee meeting.

James Fishback’s Azoria Capital sued Federal Reserve Chairman Jerome Powell and other Fed officials last week, claiming the central bank’s decades-old practice of holding its monetary policy meetings behind closed doors violates the Sunshine in Government Act, which sets transparency requirements for federal agencies.

But US District Judge Beryl Howell said at a hearing Monday that the Sunshine Act doesn’t apply to the FOMC meeting. She said she was denying Azoria’s request for an emergency order opening the July 29 meeting because the firm was unlikely to win its suit.

The FOMC meets eight times a year to decide interest rates, releasing statements on its policy decisions immediately following the meetings. Powell holds press conferences half an hour after the release of the statements, answering reporters’ questions for about an hour.

Fishback, who launched the FSD, or Full Support for Donald, Political Action Committee earlier this month has vocally backed the president in calling for Powell to lower interest rates. In its suit, Azoria said access to FOMC meetings was necessary to determine if Powell or other Fed officials were basing rates decisions on politics.

A spokesperson for Azoria didn’t immediately respond to a request for comment.

The case is Azoria Capital v. Powell, 25-cv-02388, US District Court, District of Columbia (Washington).

Source: Bloomberg

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Manuel

Central Bank

Economic

Singapore’s central bank will likely leave its monetary policy unchanged for the first time this year, adopting a wait-and-see approach as policymakers gauge looming US tariffs that risk weighing on growth.

Fourteen of 19 economists in a Bloomberg survey forecast the Monetary Authority of Singapore, which uses the exchange rate rather than interest rates to stabilize prices, will maintain its settings on Wednesday. Five, including Goldman Sachs Group Inc. and Bank of America, expect easing to continue.

The MAS loosened policy in January for the first time in five years, and again in April as the case to support the economy became stronger, following US President Donald Trump’s tariff threats and the ensuing global market ructions.

Singapore’s policy review comes ahead of the US Federal Reserve on July 31, with Chair Jerome Powell under increasing pressure from Trump to cut interest rates. The Fed is widely expected to hold steady, as it awaits clarity on the inflation impact from Trump’s tariffs, amid a wave of global cuts from Canada to the UK and Australia. Singapore Set to Hold Policy as Economy Shows Tariff Resilience_1

Singapore Set to Hold Policy as Economy Shows Tariff Resilience_1

Forecasters expecting a hold cite Singapore’s economic stability, with preliminary growth estimates this month showing the city-state dodged a technical recession — defined as two consecutive quarters of contraction. The faster-than-expected growth was led by manufacturing, services export and construction.

Chua Hak Bin, economist at Maybank Securities Pte Ltd. sees the MAS leaving its settings unchanged through the rest of the year, “in view of the resilient economic outlook and benign, but stabilizing core inflation.”

By contrast, Kai Wei Ang, Asean economist for Bank of America NA, is predicting an easing though he reckons the decision will be a “close call.”

Ang compared the current situation with April 2016, when the economy was producing close to its potential and yet the MAS eased because core inflation was forecast to average below 2%. Singapore Set to Hold Policy as Economy Shows Tariff Resilience_2

Singapore Set to Hold Policy as Economy Shows Tariff Resilience_2

Like in 2016, the economy’s negative output gap has narrowed but the outlook for core inflation appears to be “more benign,” Ang said. At the same time, Singapore’s real effective exchange rate is “elevated,” he said, suggesting the central bank will “instill its preemptive stance by flattening the slope in July, rather than wait till October.”

To meet its mandate of “medium-term price stability,” the MAS intervenes in the foreign exchange market to manage its currency within a range. It describes that process publicly, but only in general terms without providing specific figures or targets.

The main components of that policy are guiding the “slope” of the dollar’s appreciation, the “center” of that slope and the “width” of the trading band it targets.

The five analysts predicting an easing on Wednesday, for instance, expect the MAS to slightly reduce the slope of its policy band for its main Singapore dollar measure - the nominal effective exchange rate, known as S$NEER.

The MAS also doesn’t have an explicit inflation target, though it has previously said that a core inflation rate of just under 2% on average “is consistent with overall price stability in the economy.” The gauge stood at 0.6% in June.

Earlier this month, MAS Managing Director Chia Der Jiun said core inflation should remain subdued with a resurgence of underlying price pressures unlikely, while noting that policymakers are alert to risks on both sides.

One major uncertainty is the impact of US tariffs, not only on Singapore’s economy but global growth as well. Singapore was hit with a proposed 10% rate, lower than its Southeast Asian neighbors. But with trade equaling about three times its GDP, it remains exposed to any sustained slowdown in global commerce.

Seven of nine economists who responded to a question about the impact of US tariffs on Singapore’s monetary policy said the MAS was more likely to ease over 2025 and 2026. The same number expect the city-state to end up with a US import levy of 10% or lower, while three expect the rate to rise.

The view among many monetary officials around the world is that Trump’s attempt to repatriate manufacturing and rewire commerce, if enduring, may be more of a danger to growth rather than posing a threat to consumer prices. As a result, a technical recession is still possible in Singapore as the effect from businesses front-running higher US tariffs fade.

“The global outlook is uncertain,” said Philip Wee of DBS Bank Ltd. “We will be looking out for hints of a third easing at the October review, given the central bank’s base case scenario for global economic activity to slow.”

Source: Bloomberg

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James Whitman

Economic

Political

Commerce Secretary Howard Lutnick said a 90-day extension of a trade truce with China was a likely outcome with negotiations between the two countries underway in Stockholm.

“Is that a likely outcome? Sure, it seems that way, but let’s leave it to President Trump to decide,” Lutnick said in an interview Monday on Fox News when asked about reports that the two nations were considering keeping their tariff agreement in place for another three months.

Lutnick’s comments followed the start of a new round of talks between the world’s two largest economies — this time in Stockholm, where Chinese Vice Premier He Lifeng and US Treasury Secretary Scott Bessent led the respective delegations. Earlier rounds saw Washington and Beijing agree to reduce tit-for-tat levies and ease export controls on certain technology and rare-earth minerals, easing tensions that had rattled financial markets as Trump moves to enact a sweeping tariff agenda.

But that agreement is set to expire on Aug. 12, leading to new discussions aimed at extending the truce and giving the US and China more time to address issues such as duties tied to fentanyl trafficking that President Donald Trump has levied and concerns about Chinese purchases of sanctioned Russian and Iranian oil. The two sides are slated to continue talks on Tuesday.

The China trade talks also come as the US gears up for a separate deadline for other trading partners, with so-called reciprocal tariffs slated to kick in on Aug. 1 against dozens of economies. Trump initially unveiled those rates in April — before pausing them after they sparked market turmoil and giving economies a change to negotiate lower duties with the US.

But that stretch has seen few deals actually materialize even after Trump extended the initial mid-July deadline to August. The president has begun issuing letters unilaterally setting rates for countries that were not able to negotiate a deal. Trump has said more letters are coming for more than 150 countries. Earlier Monday, he said that he was considering tariffs in the range of 15% to 20% for those remaining nations.

Lutnick said Trump is still weighing possible deals even with the deadline just days away.

“He’s done these big deals. He’s got really all the cards in front of him,” Lutnick said. “As he said, he’s going to decide what the tariff rate is, how much these countries are going to open their markets.”

“That’s what we’re going to do this week. We’re going to basically — he’s going to consider a few deals, of course he will, but basically what he’s going to do is he’s going to set the tariff rate for everybody and do that by the end of the week,” he added.

Trump has shown a willingness to lower rates for countries that come with fresh offers even after announcing their levies, including Japan which was told it faced a 25% rate for Aug. 1 but was able to reduce that to 15%, including for its crucial auto exports, in a deal the US president said would include the creation of a $550 billion fund to make investments in the US.

South Korea is also seeking a deal, with negotiators discussing with the creation of their own fund to invest in US projects in exchange for a lower tariff rate, including on auto exports.

Lutnick said that South Korean negotiators “flew to Scotland,” where Trump is on a trip, to meet with the Commerce secretary and US Trade Representative Jamieson Greer.

“I mean, think about how much they really, really want to get a deal done,” Lutnick said.