JPMorgan CEO Jamie Dimon tells Fox Business US debt could cause bond turmoil

Economic

Summary:

JPMorgan CEO Jamie Dimon warned that rising U.S. debt could trigger bond market turmoil and wider credit spreads, affecting loans and small businesses. He also addressed his future at the bank.

JPMorgan Chase CEO Jamie Dimon said on Monday that the rising U.S. national debt is a "big deal" that could create a "tough time" for the bond market that causes spreads to widen, he told Fox Business’ "Mornings with Maria" program.

The comments echo his earlier warnings about potential market turmoil, citing rising U.S. government spending.

"If people decide that the U.S. dollar isn't the place to be, you could see credit spreads gap out; that would be quite a problem," Dimon said. "It hurts the people raising money. That includes small businesses, that includes loans to small businesses, includes high yield debt, includes leveraged lending, includes real estate loans. That's why you should worry about volatility in the bond market."

Shifting U.S. economic policies have sent bond markets tumbling in recent weeks.

Dimon, 69, is one of the most prominent voices in corporate America and has regularly been consulted by administrations during times of crisis. His name was floated for senior economic roles in government during the 2024 presidential campaign, including Treasury Secretary, but he stayed put at the bank.

Dimon has been running the biggest U.S. lender for more than 19 years, outlasting many other CEOs.

When asked about the timeframe for his succession, Dimon said "it's several years," adding, "there will be an appropriate time and then I may stick around for a couple of years as chairman or executive chairman... I love what I do."

source : Reuters

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Adam

Economic

China–U.S. Trade War

President Donald Trump and Chinese President Xi Jinping are likely to speak this week, a senior White House official told CNBC on Monday.

The expected discussion follows a series of flare-ups between Washington and Beijing that threaten to derail a tentative trade agreement that the two economic superpowers reached just weeks earlier.

The two leaders could speak one-on-one “very soon,” though probably not today, the official said on condition of anonymity.

U.S. market indexes opened lower on Monday morning, as investors responded to the increasingly confrontational tone of public messages between the U.S. and China.

Trade between the countries — who rely heavily on each others’ business — was effectively crushed in April, when Trump ratcheted blanket tariffs on Chinese imports up to 145% and Beijing issued steep retaliatory duties. The two sides agreed to scale back most of those tariffs for 90 days following an initial round of trade negotiations in Switzerland in mid-May.

But each nation has since accused the other of undermining the agreements struck in Geneva.

In recent weeks, the Trump administration has accused China of slow-walking renewed exports of critical minerals to the United States, while Beijing has called out Washington for issuing a warning against using Chinese chips.

On Monday, a Chinese Commerce Ministry spokesperson accused the U.S. of trying to “unilaterally provoke new economic and trade frictions, increasing the uncertainty and instability in the bilateral economic and trade relations.”

Trump administration officials have acknowledged that progress in U.S.-China trade talks has slowed. Treasury Secretary Scott Bessent said Thursday that breaking the logjam will “require both leaders to weigh in with each other.”

But Trump has vented frustration with China as the roadblocks have emerged.

“China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH US,” Trump wrote in a Truth Social post Friday.

“So much for being Mr. NICE GUY!” he wrote.

source : cnbc

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Gerik

Economic

China–U.S. Trade War

Rare Earths as a Trade Pressure Valve

As US-China trade tensions intensify following President Trump’s accusations of a Geneva agreement breach, Beijing’s control over rare earth minerals has re-emerged as a powerful strategic tool. These materials—vital for military hardware, semiconductors, and consumer electronics—are predominantly produced in China, giving the country a formidable edge in ongoing trade and technology disputes.

Washington had hoped for a reset through the Geneva accord, which included China's commitment to ease rare earth export restrictions in exchange for tariff relief. But US officials now claim China is stalling on those obligations, particularly in lifting opaque non-tariff barriers that have slowed the flow of critical minerals. This friction has cast doubt over the 90-day tariff pause, with potential for tariffs to snap back to levels above 100% if progress stalls.

A Deepening Asymmetry in Strategic Commodities

China supplies nearly 70% of the world’s rare earths, and the permitting process for exporters remains tightly controlled by Beijing. This bureaucratic bottleneck gives Chinese authorities the ability to restrict exports with minimal transparency—delays that are now rippling through global supply chains. According to the American Chamber of Commerce in China, while some export approvals are now trickling through, they are well behind industry expectations.

The impact is already visible. Ford temporarily closed a plant in Chicago due to a shortage of rare earth components. Defense contractors have flagged mineral supply as a top vulnerability in aviation and missile production. India, another major importer, has also reported pending permit approvals, warning of looming production disruptions.

This pattern suggests a form of supply-chain pressure that imposes limited immediate cost on China, while inflicting logistical and financial pain on the US and its allies. Unlike tariffs—which also harm domestic producers—rare earth restrictions primarily target foreign dependency and can be deployed more selectively.

Technology and Security: Parallel Fronts of Confrontation

Simultaneously, the US has escalated its tech restrictions, blocking China’s access to advanced chip design software, banning critical jet engine components, and tightening controls on Huawei. These moves mirror Beijing’s rare earth strategy: targeted export limitations in strategic sectors. However, Washington’s efforts are constrained by its lag in building an independent supply chain for these critical inputs.

While the Department of Defense has pledged a self-sufficient mine-to-magnet rare earth ecosystem by 2027, execution remains elusive. The US lacks sufficient natural reserves, skilled engineers, and viable commercial entities capable of operating profitably in a low-margin industry. Attempts to fill the gap via foreign investment—such as MP Materials’ deal with Saudi Arabia and deeper ties with Australia’s Lynas—highlight how far Washington still needs to go.

According to analysts like Cory Combs of Trivium China, China’s leverage is more entrenched and immediate than Washington’s, which remains heavily aspirational. Chinese firms have also made notable progress in substituting US chip technologies, reducing their vulnerability in return.

Global Ramifications: Allies in the Crossfire

The rare earth squeeze is not only a bilateral issue. Countries such as India and Japan have also been affected. India’s Bajaj Auto has already warned of halted electric vehicle production if Chinese shipments don't resume. Japanese officials have flagged rare earths as a central concern in their trade negotiations with the US, underlining the broader regional risk of being collateral damage in the Sino-American economic standoff.

If China widens its restrictions to include light rare earths—used in consumer electronics and batteries—the economic impact on US tech giants and auto manufacturers could be severe. For now, Beijing is holding back from that option, using the current controls more as a geopolitical warning than as an economic weapon. However, experts like Neil Thomas from the Asia Society caution that these tools remain on the table if tensions escalate further.

A Fragile Truce and an Uneven Battlefield

The rare earths dispute underscores the structural imbalance in the US-China trade conflict. While Washington holds sway in advanced technology controls, Beijing’s command over critical minerals gives it enduring and underappreciated influence. This leverage is especially potent given the strategic urgency of minerals in defense, aerospace, and clean energy.

With the Geneva truce unraveling and legal, political, and commercial tensions on the rise, Beijing’s grip on rare earths could become a central axis of confrontation. Unless the US accelerates its domestic supply chain development and deepens global partnerships, its industries will remain exposed—technologically advanced, yet materially dependent on a rival power.

Source: Bloomberg

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Adam

Economic

The Organization of the Petroleum Exporting Countries and its allies agreed on Saturday to add 411,000 barrels a day of supply in July, but some members objected, including Russia. With a handful of countries lobbying for a pause in July, banks are now split on how many more hikes will come in subsequent months.

Monday’s gain — West Texas Intermediate crude added as much as 5.1% before easing alongside broader markets — is also likely being aided by an unwinding of bearish bets made in advance of the decision. The group had been considering returning even more volume late last week, and speculative short positions in global benchmark Brent already were the highest since October prior to the meeting.

“The worst of the fears was laid to rest,” said Keshav Lohiya, founder of consultant Oilytics. “Brent shorts are now at the highest level in 2025, which makes sense given the bearish headlines coming out of OPEC. However, this is creating a recipe for a spike if spot healthy market fundamentals continue to roll on.”

Other bullish catalysts for crude are driving the advance, too. Ukraine struck air bases deep in Russia, while Iran criticized a report showing its growing stockpiles of enriched uranium, escalations that reduce the chances of more supply from the sanctioned OPEC+ members entering the market. Wildfires in Canada are also threatening output in the world’s fourth-largest producer.

US futures pierced the 50-day moving average. That technical marker had largely helped keep a lid on prices over recent weeks.

In London, benchmark Brent crude futures have been hovered near $65 a barrel since the middle of May as robust short-term fundamentals counter expectations of an oversupply later in the year. Alongside OPEC+’s output hikes, oil has taken direction from the fortunes of the trade war between the US and China, which threatens to sap consumption this year.

source : Bloomberg

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Gerik

Economic

Commodity

Heightened Geopolitical Risk Drives Flight to Safety

Gold prices surged on Monday, reflecting a surge in haven demand as global tensions deepened on multiple fronts. With Russia and Ukraine locked in intensified hostilities and US-China trade relations deteriorating, investors rushed into bullion as a hedge against instability. Spot gold rose as much as 2.7% intraday, eventually settling at $3,372.28 an ounce, marking a 2.5% gain for the session. The move reinforces gold’s traditional role as a safe asset in times of geopolitical and financial uncertainty.

This surge comes amid an environment already favorable to bullion. Gold has risen over 28% year-to-date, fueled by a record high in April above $3,500 per ounce. That trajectory has been reinforced by both escalating global risk and the erosion of confidence in central bank predictability.

Ukraine-Russia Conflict Resurfaces as a Market Catalyst

A critical driver of the latest price spike was renewed military escalation in Eastern Europe. Ukraine conducted widespread drone strikes on Russian territory over the weekend, prompting Moscow to retaliate with one of its longest missile assaults on Kyiv to date. A second round of peace talks in Istanbul ended without progress, adding to fears of prolonged conflict and energy market disruptions.

This scenario does not directly affect physical gold supply or demand but exerts strong indirect influence on investor psychology. As the conflict injects uncertainty into global risk assets and commodity markets, capital naturally reallocates toward stable stores of value such as gold.

US-China Trade Friction Reinforces Gold’s Appeal

Simultaneously, tensions between the United States and China flared anew after President Trump accused Beijing of violating the Geneva trade agreement, followed by plans to double tariffs on steel and aluminum. China responded by accusing the US of breaching the truce and threatened retaliation. These developments, combined with fresh legal ambiguity surrounding existing tariffs, have reintroduced trade uncertainty as a major macroeconomic variable.

Trade friction undermines investor confidence, pressures global growth projections, and raises the appeal of non-yielding assets like gold—especially when equity markets struggle to price policy risk.

Weak Economic Data Adds Monetary Policy Uncertainty

Adding fuel to gold’s rally was the latest US manufacturing data, which showed signs of weakening activity. This softness challenges the Federal Reserve’s already constrained policy options, as inflation remains sticky while growth shows signs of fragility. Investors are now increasingly focused on labor-market data, particularly the upcoming May jobs report, as a potential signal for future rate adjustments.

The weakening economic backdrop, combined with a 0.6% drop in the Bloomberg Dollar Spot Index, amplified gold’s rally. A falling dollar makes gold cheaper for foreign investors, boosting demand and contributing to price momentum across the precious metals complex.

Broader Precious Metals Surge Alongside Gold

Silver prices jumped the most since October, while platinum and palladium also gained. Silver, often viewed as both an industrial and monetary metal, benefited from the dual drivers of safe-haven flows and concerns about supply chain disruption. These metals typically respond with higher volatility during broad-based risk episodes, and the present environment offers strong tailwinds for the entire sector.

The resurgence in gold demand reflects a convergence of destabilizing factors—military conflict, trade breakdowns, economic uncertainty, and legal unpredictability. As risk premiums rise across asset classes, gold remains one of the few assets perceived as offering both liquidity and safety. While upcoming US labor data may temper expectations for further price gains, the underlying fundamentals suggest that gold’s elevated status in investor portfolios will remain intact as long as geopolitical and macroeconomic volatility persist.

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Thomas

Political

Iran is poised to reject a U.S. proposal to end a decades-old nuclear dispute, an Iranian diplomat said on Monday, dismissing it as a "non-starter" that fails to address Tehran's interests or soften Washington's stance on uranium enrichment.

"Iran is drafting a negative response to the U.S. proposal, which could be interpreted as a rejection of the U.S. offer," the senior diplomat, who is close to Iran's negotiating team, told Reuters.

The U.S. proposal for a new nuclear deal was presented to Iran on Saturday by Omani Foreign Minister Sayyid Badr Albusaidi, who was on a short visit to Tehran and has been mediating talks between Tehran and Washington.

After five rounds of discussions between Iranian Foreign Minister Abbas Araqchi and President Donald Trump's Middle East envoy Steve Witkoff, several obstacles remain.

Among them are Iran's rejection of a U.S. demand that it commit to scrapping uranium enrichment and its refusal to ship abroad its entire existing stockpile of highly enriched uranium - possible raw material for nuclear bombs.

Tehran says it wants to master nuclear technology for peaceful purposes and has long denied accusations by Western powers that it is seeking to develop nuclear weapons.

"In this proposal, the U.S. stance on enrichment on Iranian soil remains unchanged, and there is no clear explanation regarding the lifting of sanctions," said the diplomat, who declined to be identified due to the sensitivity of the matter.

Araqchi said Tehran would formally respond to the proposal soon. The U.S. State Department declined to comment.

Tehran demands the immediate removal of all U.S.-imposed curbs that impair its oil-based economy. But the U.S. says nuclear-related sanctions should be removed in phases.

Dozens of institutions vital to Iran's economy, including its central bank and national oil company, have been blacklisted since 2018 for, according to Washington, "supporting terrorism or weapons proliferation".

Trump's revival of "maximum pressure" against Tehran since his return to the White House in January has included tightening sanctions and threatening to bomb Iran if the negotiations yield no deal.

During his first term in 2018, Trump ditched Tehran's 2015 nuclear pact with six powers and reimposed sanctions that have crippled Iran's economy. Iran responded by escalating enrichment far beyond the pact's limits.

Under the deal, Iran had until 2018 curbed its sensitive nuclear work in return for relief from U.S., EU and U.N. economic sanctions.

The diplomat said the assessment of "Iran's nuclear negotiations committee", under the supervision of Supreme Leader Ayatollah Ali Khamenei, was that the U.S. proposal was "completely one-sided" and could not serve Tehran's interests.

Therefore, the diplomat said, Tehran considers this proposal a "non-starter" and believes it unilaterally attempts to impose a "bad deal" on Iran through excessive demands.

NUCLEAR STANDOFF RAISES MIDDLE EAST TENSIONS

The stakes are high for both sides. Trump wants to curtail Tehran's potential to produce a nuclear weapon that could trigger a regional nuclear arms race and perhaps threaten Israel. Iran's clerical establishment, for its part, wants to be rid of the devastating sanctions.

Iran says it is ready to accept some limits on enrichment, but needs watertight guarantees that Washington would not renege on a future nuclear accord.

Two Iranian officials told Reuters last week that Iran could pause uranium enrichment if the U.S. released frozen Iranian funds and recognised Tehran's right to refine uranium for civilian use under a "political deal" that could lead to a broader nuclear accord.

Iran's arch-foe Israel, which sees Iran's nuclear programme as an existential threat, has repeatedly threatened to bomb the Islamic Republic's nuclear facilities to prevent Tehran from acquiring nuclear weapons.

Araqchi, in a joint news conference with his Egyptian counterpart in Cairo, said: "I do not think Israel will commit such a mistake as to attack Iran."

Tehran's regional influence has meanwhile been diminished by military setbacks suffered by its forces and those of its allies in the Shi'ite-dominated "Axis of Resistance", which include Hamas, Hezbollah, the Houthis in Yemen, and Iraqi militias.

In April, Saudi Arabia's defence minister delivered a blunt message to Iranian officials to take Trump's offer of a new deal seriously as a way to avoid the risk of war with Israel.

Source: TradingView

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Adam

Forex

The US Dollar is beginning the week on a tough note as the White House appealed the Federal Court decision to block US tariffs - which has also dampened the risk-appetite on the week.

All majors are higher with the Asian-Pacific currencies leading the charge - NZD and JPY are both up above 0.80% against the USD in the morning session.Gold is also much higher +2.40% on the day, with Bitcoin and Stock Indices down (though not by too much).

Let's dive into a DXY Analysis starting from the Monthly timeframe.

US Dollar Monthly, Weekly and Daily Analysis

Monthly Chart

Dollar Index Monthly Chart, June 2, 2025.

A weaker US Dollar is one of the technical themes moving forex markets.

The Index is still at a relatively high level especially when compared to the 2010 decade where the USD was still recovering from the damages done by the 2008 Financial Crisis and the QE that followed.

The 2010 decade low for the DXY was at 72.80!

For a reminder, Quantitative Easing is a policy to "print" money to buy government bonds or other assets. This helps lower interest rates and boost the economy when growth is slow - like after 2008.

We can see that the monthly MA 200 is closer to 91.50 - levels last seen in October 2021. Especially with the FED not having began its cut cycle, it's too early to say the Dollar is already weak.

A zone to look out for in the upcoming weeks would be the lower key support at 95.50. We'll see better on a weekly chart.

Weekly Chart

Dollar Index Weekly Chart, June 2, 2025.

After hanging around here for the last two months, we spent most of last week below the 100.00 Psychological level, and Moving Averages are now all above current prices.

They will now act as resistance instead of support, though they may magnet the Index higher on retracements.

Prices were in a solid range—100.00 to 106.00—between 2022 to 2024, and a breakout to the upside at the end of last year was rejected, as prices have gone down sharply since the 110.00 highs in February 2025.

In the meantime, a deeper selloff in the Dollar index points at a new range forming between 95.50 and 100 - these prices are still far, though more uncertainty and tariffs may accelerate this.

Daily Chart

Dollar Index Daily Chart, June 2, 2025.

We officially completed the U-turn from the September 2024 rise in the DXY to its ongoing fall.

There is a key pivot zone between 100.00 to 100.75 that was breached and is now acting as resistance as prices already bounced from there last week.

The descending trendline and MAs acting as resistances seem to be applying more pressure though as observed, the Daily MA 20 seems to be a candidate for retracements. It's hanging around just above the 100.00 level.

We are currently trading in the immediate Support Zone between 98.50 to 99.00, a break trough here would point towards the April Lows at 97.20.

However, a rebound from here could point to a return to the key pivot zone and a consolidation of current prices.

Let's see how to Trump Tariffs unfold as this will surely influence the appetite for the Dollar. Also don't forget the key events of the week with the Bank of Canada and ECB in the middle of the week and May NFP on Friday.