Kurdish PKK Disbands And Ends Turkey Insurgency, PKK-linked Agency Says

Political

Summary:

The Kurdistan Workers Party (PKK) militant group, which has been in conflict with the Turkish state for more than four decades, has decided to dissolve itself and end its armed struggle, a news agency close to the group reported on Monday.

The PKK decision is set to have far-reaching political and security consequences for the region, including in neighbouring Syria where Kurdish forces are allied with U.S. forces.

The Firat news agency published what it said was the closing declaration of a congress that the PKK held last week in northern Iraq, in response to a call in February from its jailed leader Abdullah Ocalan to disband.

Turkish President Tayyip Erdogan's office and the foreign ministry did not immediately comment on the announcement.

More than 40,000 people have been killed in the conflict since the PKK launched its insurgency in 1984. It is designated a terrorist group by Turkey and its Western allies.

Source: Reuters

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Forex

China–U.S. Trade War

Economic

The Government of the United States of America (the “United States”) and the Government of the People’s Republic of China (“China”),

Recognizing the importance of their bilateral economic and trade relationship to both countries and the global economy;

Recognizing the importance of a sustainable, long-term, and mutually beneficial economic and trade relationship;

Reflecting on their recent discussions and believing that continued discussions have the potential to address the concerns of each side in their economic and trade relationship; and

Moving forward in the spirit of mutual opening, continued communication, cooperation, and mutual respect;

The Parties commit to take the following actions by May 14, 2025:

The United States will (i) modify the application of the additional ad valorem rate of duty on articles of China (including articles of the Hong Kong Special Administrative Region and the Macau Special Administrative Region) set forth in Executive Order 14257 of April 2, 2025, by suspending 24 percentage points of that rate for an initial period of 90 days, while retaining the remaining ad valorem rate of 10 percent on those articles pursuant to the terms of said Order; and (ii) removing the modified additional ad valorem rates of duty on those articles imposed by Executive Order 14259 of April 8, 2025 and Executive Order 14266 of April 9, 2025.

China will (i) modify accordingly the application of the additional ad valorem rate of duty on articles of the United States set forth in Announcement of the Customs Tariff Commission of the State Council No. 4 of 2025, by suspending 24 percentage points of that rate for an initial period of 90 days, while retaining the remaining additional ad valorem rate of 10 percent on those articles, and removing the modified additional ad valorem rates of duty on those articles imposed by Announcement of the Customs Tariff Commission of the State Council No. 5 of 2025 and Announcement of the Customs Tariff Commission of the State Council No. 6 of 2025; and (ii) adopt all necessary administrative measures to suspend or remove the non-tariff countermeasures taken against the United States since April 2, 2025.

After taking the aforementioned actions, the Parties will establish a mechanism to continue discussions about economic and trade relations. The representative from the Chinese side for these discussions will be He Lifeng, Vice Premier of the State Council, and the representatives from the U.S. side will be Scott Bessent, Secretary of the Treasury, and Jamieson Greer, United States Trade Representative. These discussions may be conducted alternately in China and the United States, or a third country upon agreement of the Parties. As required, the two sides may conduct working-level consultations on relevant economic and trade issues.

Source：Whitehouse

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Gerik

Economic

Currency Appreciation Adds Pressure on Export Margins

A sharp and synchronized rise in Southeast Asian currencies during May has raised alarm among export-reliant economies. This appreciation, driven by global dollar weakness and positive sentiment surrounding U.S.–Asia trade talks, is eroding price competitiveness for exporters in Thailand, Vietnam, Indonesia, and others.

According to MUFG Bank, Thailand is particularly vulnerable, leading the region in sensitivity to foreign exchange volatility. Senior currency analyst Michael Wan noted that Thailand’s export sector could be significantly impaired in the near term due to the baht’s strong performance against the U.S. dollar.

The HSBC forex report dated May 5 identified three waves of appreciation across ASEAN currencies. The first came after the U.S. temporarily postponed retaliatory tariffs on April 10, the second followed a broader USD sell-off on April 21, and the third stemmed from easing U.S.–China trade tensions around April 29. Collectively, these movements pushed several ASEAN currencies to their strongest levels since early 2025.

Tariff Uncertainty Returns as 90-Day Deadline Approaches

Overlaying this forex trend is the nearing expiration of President Trump’s 90-day tariff delay, set to end in July. If the U.S. resumes its protectionist stance, Southeast Asian exporters—especially in electronics, textiles, and food—could see margins compressed further. These economies, many of which have already lost share to reshoring trends or competition from India and China, now face additional pricing pressures.

Economists argue that countries will prioritize preserving access to the U.S. market, even at the cost of short-term profitability. Philip Wee of DBS predicts that policymakers will avoid competitive devaluation and instead focus on maintaining stable trade relations with Washington.

Strategic Reactions from ASEAN Central Banks

Despite currency surges, central banks across the region are showing restraint. Analysts observe no direct intervention so far from Singapore, Malaysia, or Thailand, though volatility management remains a likely tool. In Indonesia, the rupiah’s rebound is being welcomed, given the country’s previous double-digit depreciation between September 2024 and April 2025.

The People's Bank of China, meanwhile, is maintaining a tightly managed daily reference rate for the renminbi, signaling its intent to control regional currency dynamics and limit appreciation relative to other Asian peers. As China’s RMB acts as a regional benchmark, its stability is helping mitigate excessive volatility in ASEAN currency markets.

Wider Impact and Portfolio Shifts Underway

With Asian central banks sitting on large holdings of U.S. assets, including Treasuries and corporate equities, any significant change in U.S. trade balances could trigger long-term portfolio rebalancing. This may not immediately translate to capital outflows, but it could redirect flows toward alternative global assets less exposed to dollar-denominated risks.

The Taiwanese dollar has led the regional appreciation, posting one of its largest single-day gains in decades. Analysts see this as a catch-up effect rather than a new macro trend, though the scale of adjustment highlights how quickly sentiment has shifted against the dollar.

Navigating a Delicate Balancing Act

Southeast Asian exporters are facing a complex environment marked by currency appreciation and renewed tariff risks. While regional central banks are adopting a cautious “hands-off” stance, the strategic imperative remains clear: sustain access to the U.S. market while navigating shifting forex dynamics and global trade realignments.

Whether these economies can balance exchange rate pressures without sacrificing trade competitiveness will determine the stability of their export-driven recoveries in the second half of 2025.

Source: The Business Times

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Economic

Streamlining Gulf Investment Amid AI and Infrastructure Ambitions

Just days ahead of President Donald Trump’s diplomatic visit to Saudi Arabia, Qatar, and the United Arab Emirates, the U.S. government has unveiled a “priority” investment channel targeting strategic allies—especially wealthy Gulf nations that collectively manage nearly 40% of global sovereign wealth fund assets.

A centerpiece of this shift is a new digital investment portal announced by the U.S. Treasury on May 8. Through this platform, the Committee on Foreign Investment in the United States (CFIUS) will begin pre-screening foreign investors before they formally file investment proposals. This system aims to reduce procedural delays and streamline approvals for vetted allied investors, particularly those from countries deemed non-threatening to U.S. national interests.

Geopolitical Calculations Shape Investment Access

This investment fast lane reflects deeper geopolitical dynamics. With UAE pledging $1.4 trillion in U.S. investments over the next decade—and Saudi Arabia promising $600 billion in just four years—the Biden administration (under Trump’s continuity) is positioning America as the premier destination for Gulf capital. Much of this funding is earmarked for critical sectors such as artificial intelligence, semiconductor technology, and green infrastructure.

In particular, the UAE has aggressively courted U.S. tech partnerships, distancing itself from Chinese platforms and seeking better access to American-made advanced chips, including from leaders like Nvidia. Abu Dhabi has lobbied Washington for smoother regulatory engagement, emphasizing alignment with U.S. strategic interests and national security goals.

Balancing Open Investment with National Security Scrutiny

While facilitating Gulf investment, the Treasury remains committed to safeguarding U.S. security. Secretary Scott Bessent reaffirmed that the goal is not to dilute CFIUS’s oversight but to enhance efficiency without compromising scrutiny. Investments from adversarial nations, notably those linked to the Chinese government, will continue to face tight restrictions under Trump’s "America First Investment Policy" directive signed in February.

This dual-track approach creates a clear delineation between “trusted capital” from allied nations and “strategically sensitive” investments from geopolitical rivals. It also enables Washington to leverage economic diplomacy as a tool to reinforce alliances and shift global capital away from competitors like China.

Implications for U.S. Economic and Strategic Positioning

The Gulf states' eagerness to deepen economic ties with the U.S. is driven by a mix of security dependence, technological ambition, and portfolio diversification. Their sovereign wealth funds, flush with energy-derived capital, are now actively seeking exposure to high-growth sectors in stable jurisdictions—making the U.S. an ideal target.

President Trump’s upcoming visit is expected to solidify these intentions, with senior U.S. executives joining him to explore bilateral partnerships. While specific investment agreements may be finalized later, the groundwork being laid now signals a strategic recalibration of Gulf-U.S. economic relations under the lens of national interest and mutual security.

By easing bureaucratic hurdles and enhancing trust-based vetting, the U.S. is sending a clear signal: capital from allied nations—particularly the Gulf—is not only welcome but strategically prioritized. As geopolitical rivalry with China intensifies, the Biden-Trump axis is leveraging financial alignment as a new pillar of global influence.

Source: Arab News

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Cryptocurrency

Bitcoin Reclaims a Pivotal Price Level

At 8:05 AM (Vietnam time), Bitcoin briefly touched $105,032 according to Binance data—its highest point in over three months—before slipping back to $104,495 minutes later. Although this level is not an all-time high (which remains at $109,588), it holds symbolic significance for both short-term traders and long-term holders.

The $105,000 mark acts as a key psychological resistance zone. Market participants closely watch this level as a potential inflection point where market sentiment—driven by emotion rather than fundamentals—could shift decisively. Terms such as herd mentality, greed, fear, and hope are often associated with such zones, especially in volatile crypto environments.

Accumulation and Distribution Patterns Diverge

During the past week, over 30,000 BTC (worth over $3.13 billion) were accumulated, suggesting active buying by large players or institutions. However, technical data also shows that long-term holders—those who bought earlier at lower prices—have started to offload some of their positions, creating a tug-of-war between accumulation and distribution forces.

This divergence points to market uncertainty. Bulls see strength in accumulation volumes, while bears caution against the selling pressure from early investors who may view this as a profit-taking opportunity near a psychological ceiling.

Resistance and Support: A Market-Critical Battleground

The $105,000 level is not merely numerical—it has become a psychological battleground. Technical analysts emphasize that if Bitcoin convincingly breaks above and sustains this level, it could flip from resistance to support. Such a breakout would likely reignite momentum, potentially driving Bitcoin toward the next key target of $110,000.

Conversely, failure to breach and hold above $105,000 could lead to a retreat toward $100,000, which currently serves as the nearest support zone. Given the intensity of market speculation and recent volatility, both scenarios remain in play.

The recent price movement marks a pivotal phase in Bitcoin’s medium-term trajectory. While institutional interest and accumulation patterns support a bullish thesis, the psychological weight of the $105,000 level—compounded by long-term holders’ selling pressure—adds complexity to the outlook. Market participants are now watching whether Bitcoin can solidify its position above this threshold or fall back into its prior range.

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China–U.S. Trade War

Economic

Turning Point in Fiscal Policy and Economic Governance

China’s 2025 "Two Sessions" marked a clear pivot in the country’s economic strategy. The Chinese government is departing from its long-standing fiscal discipline—traditionally anchored to a 3% GDP deficit cap—and embracing a more assertive stance by raising the fiscal deficit to 4% of GDP, the highest in modern Chinese history. This bold move is aimed at reviving domestic demand and stabilizing financial markets amid intensifying geopolitical risks and faltering global trade.

Central to this pivot is the Communist Party’s renewed emphasis on state-led interventions in real estate and equity markets, sectors seen as crucial to macroeconomic and social stability. By loosening fiscal constraints, Beijing signals a preference for growth-oriented state activism over austerity—a reflection of its political commitment to manage both economic momentum and internal cohesion.

Stabilization Funds and Market Intervention

Prominent proposals during the legislative sessions came from National People's Congress delegate and businessman Liu Hanyuan. He advocated for two RMB 10 trillion (USD 1.37 trillion) stabilization funds—one to shore up China’s stock market, and another to resolve real estate overhangs by absorbing unsold properties and preventing developer defaults.

These proposed mega-funds represent a proactive effort to reduce systemic risk and avoid spillover crises. They signal that Beijing is prepared to take aggressive financial actions, akin to crisis containment strategies seen in the post-2008 West, but tailored to the hybrid model of a party-led economy.

Stimulating Domestic Consumption: Short-Term Boost, Long-Term Shift

Beyond market interventions, China’s policy shift places household consumption at the center of growth. Initiatives such as consumer subsidies for electric vehicles, household appliances, and green technologies are designed to kick-start demand in the short term.

However, the long-term transformation depends on structural reforms to boost disposable income—particularly through enhanced social welfare, pensions, and public healthcare systems. By improving the social safety net, China aims to reduce precautionary savings and channel household income into sustained spending, thereby reducing the economy’s reliance on infrastructure-led expansion.

Foreign Policy Recalibration and Strategic Economic Partnerships

This domestic reorientation aligns with a broader recalibration of China’s foreign policy. The country is increasingly engaging with Global South partners to diversify trade relationships and bypass U.S.-centric financial channels. It is also promoting renminbi-denominated trade as a strategic hedge against Western financial dominance.

China’s growing presence in Saudi Arabia—having invested USD 21.6 billion between 2021 and 2024, one-third of which went into clean technology—highlights its role in global energy transition and digital infrastructure. This aligns with its domestic strategy to develop green industries and become a leader in digital and low-carbon technologies.

China is also ramping up exports of electric vehicles and solar panels to African nations, using green technology as both an economic and diplomatic tool to reshape global value chains and project itself as a champion of sustainable development.

Risks of Economic Decoupling and Strategic Tensions

While these moves enhance China’s strategic autonomy, they also increase the risk of prolonged economic decoupling from the United States. Beijing’s push for renminbi trade, supply chain realignment, and new investment blocs may further fragment the global economy, especially as tensions with Washington persist.

President Xi Jinping’s recent visits to Southeast Asia underscore this multidimensional strategy. China seeks to deepen regional alliances while simultaneously hedging against external shocks—be it tariffs, sanctions, or financial exclusion—thereby preparing for a new era of economic geopolitics.

China’s economic pivot marks a deliberate attempt to redefine growth within its borders while repositioning itself globally. The success of this transformation hinges on its ability to maintain domestic financial stability, elevate consumer demand, and build resilient external partnerships—all while managing the risks of geopolitical fragmentation and potential global economic bifurcation.

Source: AInvest

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Economic

Slow Uptake of Mobile Salary Payments

Two years after the Japanese government approved electronic salary payment through applications such as PayPay, adoption rates remain remarkably low. According to a survey by MMD Labo, only 2.8% of respondents aged 18 to 69 reported receiving wages via mobile apps.

This tepid response comes despite Japan’s broader push toward a cashless society. More than 100 companies have rolled out the app-based salary disbursement model, but it has yet to gain meaningful traction among workers or employers.

Trust and Perceived Value Limit Adoption

One of the primary barriers appears to be the perceived lack of benefit. Nearly half of those disinterested in mobile wage payments indicated they simply did not see the need for such a system. In a separate government-commissioned survey of 10,000 participants, one-third outright rejected the idea, citing concerns ranging from privacy to unfamiliarity with the platforms.

Experts suggest that in order for app-based payroll solutions to become mainstream, employers must better communicate practical advantages such as speed, convenience, and integration with broader digital financial services. Currently, the benefits remain abstract for many Japanese workers accustomed to conventional banking channels.

Full-Time Employees Dominate the Program

Another structural limitation lies in the program's target demographic. Most electronic salary payments are offered only to full-time employees, leaving out part-time and gig workers—who are statistically more likely to prefer rapid or flexible payment systems.

Ironically, it is this excluded group—part-time and temporary staff—that could benefit most from instant app-based transfers. Without structural adjustments to widen eligibility and support flexible disbursement, the program’s relevance may remain limited.

Corporate Reluctance Adds to the Challenge

Employers, too, appear hesitant. A government survey involving roughly 2,300 companies showed that nearly 80% had no plans to introduce app-based salary options. Most cited procedural difficulties, lack of demand from employees, and potential administrative complexity.

Firms must also obtain explicit employee consent before switching to app-based disbursement, further complicating the shift. Without a compelling business case or regulatory incentive, most companies find little reason to change existing systems.

While Japan has made progress in digital payments in retail and personal finance, mobile salary payments remain a cultural and logistical leap. The reluctance among workers and companies alike underscores how deeply rooted habits, trust, and perceived necessity can influence the pace of technological adoption—even in one of the world’s most advanced economies.