Price hikes may soon bite as firms sell off pre-tariff inventory, says global business group

Economic

Summary:

Tariff-driven price hikes may hit by late Q3 as firms deplete pre-tariff inventories. Companies are exploring global price increases to offset costs, signaling broader inflation risks beyond just U.S. consumers.

Tariff-related price hikes may start to bite at the end of the third quarter as companies may by then have sold off U.S. stockpiles built up ahead of the new duties, according to the International Chamber of Commerce.

Businesses making everything from cars to drugs and cheese and wine have expedited deliveries to the United States this year to get ahead of U.S. President Donald Trump's tariffs.

They have about four months of inventory, about one month more than average, Andrew Wilson, International Chamber of Commerce deputy secretary general, estimated on Thursday, helping some delay hiking prices.

"You could expect it to bite at the end of Q3," he told Reuters once they have sold off that inventory. Wilson previously forecast tariff-related price hikes would show up in U.S. inflation in the fourth quarter or early next year.

Data on Thursday showed U.S. inflation increased in June as tariffs started raising the cost of some goods, supporting economists' expectations that price pressures would pick up in the second half.

Some of the world's biggest companies have warned for months that they would be squeezed by duties.

They have now started to outline how they plan to pass on the costs and change their businesses to try to cushion the blow of rising costs, uncertainty over U.S. trade policy, and waning consumer confidence.

Companies are testing how much they can pass tariffs onto U.S. customers.

But global retailers including sandal maker Birkenstock and jeweller Pandora have also looked at raising prices across multiple markets to avoid hurting U.S. sales.

"There's a logic taking hold that (price hikes) won't be just borne by the U.S. consumer," he said.

Source: Reuters

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Adam

Forex

APAC currencies have struggled over the past month, with NZD among the laggards amid a strong US Dollar comeback.

The FOMC kept rates unchanged at its latest meeting yesterday, and FX Markets are now preparing for the upcoming RBNZ decision, slated for August 14.

NZDUSD has been relatively rangebound within a 2-handle zone since May, following a sharp April down-move sparked by volatility around Trump's infamous Liberation Day.

Before attacking the multi-timeframe technical analysis of NZDUSD, here is a small reminder that this morning, the reports for the Core PCE—which came slightly above expectations (2.8% y/y vs 2.7% estimate)—and an as-expected Canadian GDP (-0.1% m/m) also got released, both of which helped anchor further USD flows.

For the Kiwi, tonight’s NZ Consumer Confidence and Building Permits data will provide insight into local momentum heading into August's policy window.

NZDUSD Multi-timeframe technical analysis

NZDUSD Daily Chart

NZDUSD Daily Chart, July 31, 2025

Bears have taken control of the Kiwi throughout July sending the pair down around 3.50% from its 2025 Highs as the month concludes – NZDUSD has also recently broken out of a Monthly upwards Channel (light blue)The Daily picture is not showing many signs of reversals after forming a strong bearish inverted hammer.The pair is now entering the Main 0.59 Support Zone, surely prompting reactions as Month-end flows commence – Daily RSI is flattening just above the oversold level.Looking closer will allow us to spot if more balanced price action is into play here.

NZDUSD 4H Chart

NZDUSD 4H Chart, July 31, 2025

The downwards correction had taken a small break in the beginning of last week but got met with another sharp response which marked some lower highs (0.60580) right below the Monthly Channel.One element that would give back some balance for NZD buyers would be the reactions at the highs of the July Hourly steep downwards channel that also got broken, within the 0.59 Support Zone.Failure to rebound from here would maintain seller strength – Looking at the Dollar Index would be very beneficial also to spot reactions as the Index arrives at the 100.00 level.

NZDUSD 1H Chart

NZDUSD 1H Chart, July 31, 2025

Looking even closer, we spot reactions to the Support Zone that is currently being tested at a break-retest of the Hourly downwards channel, last line of defense for the Monthly range.Buyers are stepping in, attempting to form a hourly double bottom at the 0.5890 level.Momentum is coming back slightly from oversold levels, therefore reactions here are key.A 4H Candle closing below the daily lows would cancel the double bottom formation, but in the meantime, the action looks more balance in shorter timeframes

Source: marketpulse

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Devin

Economic

President Trump announced in a Truth Social 网站 that he is extending trade talks with Mexico for another 90 days. Yahoo Finance Washington Correspondent.

President Trump announcing on Truth Social he is extending Mexico's current tariff rates for 90 days to allow more time for trade negotiations with the country. That announcement coming after Trump threatened last month to increase Mexico's country-based duty to 30% starting August 1st. The president's decision coming shortly after he said he would not extend his Friday deadline. Joining us now, Washington correspondent Ben Werschkull. Ben, we were just talking about the countries that have been left out in the cold so to speak. Mexico was one of them, but it seems like they're getting a little more time, but the time that they're getting comes still with these high tariffs attached.

For sure. Yeah. So this is, this is the 90 day pause that Trump announced just a few minutes ago, and it'll, it'll keeps the rates at 25%. So it's not a 5% increase to, to 30%. I do think it's significant that Trump talked about this call as very successful. He had a lot of kind words for Mexican president Claudia Sheinbaum, um, as, as they met this morning to, to kind of work out these deals considering how, how many, how many issues they have to work out over the next 90 days on the border and these other things. Um, other things Trump announced today in this post will be that the 25% headline rate will continue, the 25% auto rate will continue. That's, that's a big one in focus. And then as with all the other deals, the 50% tariffs on steel, aluminum and copper, which is also coming tomorrow, will, will, will stay in place. So those, those rates will stay now. Um, Trump also announced that Mexico has agreed to terminate its non-tariff trade barriers without providing any additional details there. the President Sheinbaum did already respond to confirm this call and to confirm the 90 day pause. What she says she's focused on for the next 90 days is building a long-term deal with President Trump on all these other more complex trade issues.

Source: Kitco

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Adam

Stocks

US equity futures surged, lifted by blockbuster results from Microsoft (NASDAQ:MSFT) and Meta (NASDAQ:META), as the tech giants reinforced investor optimism around artificial intelligence. Microsoft soared more than 8%, while Meta climbed 12%, both posting results well ahead of expectations and signalling continued aggressive investment in AI infrastructure.

With more tech earnings to come today, sandwiched between key economic releases, and not to mention the August 1 tariffs deadline looming tomorrow, markets will face heightened volatility in the next day and a half.

Before discussing the macro factors further and what to watch, let’s quickly turn our gaze to the charts first.

S&P 500 Continues To Make New Highs

With the S&P 500 futures at new record levels, the bullish trend is continuing for now, meaning dip-buying remains the preferred trading strategy until we see a change in the market structure of higher highs and higher lows.

S&P 500: Will Strong Earnings From Big Tech Keep Outweighing Trade Risks?_1

Short-term support now comes in at 6,435, marking the high from Wednesday, followed by the day’s close at 6,396, before those earnings caused the S&P 500 futures to gap. Below these levels, 6,333 is another important support level that needs to hold. As well as prior resistance, the 21-day average comes into play here, too. Only if we go below this level can we then talk about the possibility of a deeper pullback towards the old records set earlier this year, around the 6,150-6,166 area.

On the upside, there are clear blue skies, and it is anyone’s guess where the next resistance will come. Still, it is important to keep an eye on round handles like 6,500.

Meanwhile, keep an eye on the Relative Strength Index (RSI), which continues to trade at overbought levels of above 70. It will need to unwind through price action (i.e., a sell-off) or time (i.e., consolidation). The latter would be a bullish outcome, the former bearish.

Big Tech Keeps Rallying Going For Now

The S&P 500 futures rose by 1%, but let’s see if the gains can hold heading deeper into the week. Markets are currently being pulled in two directions: on one hand, a powerful earnings season led by tech is providing real momentum for equities.

On the other hand, ongoing trade tensions and central bank policy ambiguity are acting as counterweights. For now, investors are choosing to focus on the former — but the balance remains fragile. Much will hinge on the next data prints and whether Trump’s tariff barrage finds traction in the real economy.

Microsoft’s performance now puts it within striking distance of a $4 trillion market capitalisation – if it can hold onto some of those pre-market gains into the cash open.

Amazon (NASDAQ:AMZN) and Apple (NASDAQ:AAPL) are next in line, with results due later after the close today. Markets will be watching closely to see if the momentum continues in the AI trade and whether the rest of the Magnificent Seven will deliver this quarter. So far, they’ve not disappointed.

So, it is the big rally in Big Tech which is helping to keep the S&P 500 rally going for now, with investors growing worried about the impact on inflation of Trump’s tariffs. This has also worried the Fed, raising uncertainty over the path of interest rates.

Tariffs: Trump Ups the Ante

On the trade front, tensions have escalated after President Trump announced a 15% tariff on South Korean imports, matching measures previously levied on Japan, alongside a demand for $350 billion in US-bound investment from Seoul. India has also been targeted, facing a 25% levy, with Washington citing its continued purchases of Russian oil and defence equipment. However, spared the most traded forms of copper while slapping others with duties of up to 50%.

These moves come ahead of the August 1 deadline set by the White House, with countries lacking bilateral trade agreements facing potential blanket tariffs ranging from 15% to 50%. Trump’s gambit, aimed at reshaping global trade and bringing manufacturing back onshore, has so far not caused a major, long-lasting drop in markets, beyond that swoon in early April. With indices now at record levels, Trump appears to win the market’s vote of confidence with his trade tactics.

September Rate Cut No Longer A Sure Thing

Fed Chair Jerome Powell delivered a hawkish hold, emphasising that no decision has yet been made regarding a September policy cut. While two Fed officials — Bowman and Waller — dissented in favour of a cut, Powell remained steadfast in his view that inflation risks remain present, and that a modestly restrictive stance is still warranted.

Expectations that inflation could take a boost from tariffs in the coming months have helped to support bond yields and the US dollar. In reaction to Powell’s hawkish press conference, markets quickly adjusted expectations, with pricing for a September rate cut slipping from 16 basis points to just 11. Powell’s remarks placed him squarely at odds with the White House, with Trump continuing to demand multiple rate cuts.

The hawkish repricing of the Fed’s policy has also been bolstered by strong GDP data and expectations that core inflation may remain sticky. Traders are now focused on upcoming economic prints — particularly today’s core PCE numbers and Friday’s jobs data — which could further influence rate expectations.

Source: investing

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Adam

Commodity

Silver prices have fallen around 4.5% over the last two trading days as a resurgent US Dollar and weaker haven flows weigh on prices.

The US Dollar remains strong, and rising US bond yields are limiting any chance of recovery for now. The Dollar’s strength is driven by hawkish comments from Fed Chair Jerome Powell, along with strong US GDP and job data. These factors support the Federal Reserve’s cautious stance on monetary policy and reduce expectations for rate cuts in the near future.

Now Silver's extended rally this year was down to a combination of factors. Those include safe haven demand, a weak US Dollar and supply demand discrepancies.

Now if haven demand remains low and the US Dollar rally continues, how deep could the pullback in silver prices be? For the record, the discrepancy between supply and demand remains in play and is highly unlikely to change anytime soon.

With that in mind and only one of the three main causes of the silver rally still present, what could the potential downside for silver be?

Technical Analysis - Silver (XAG/USD)

From a technical standpoint, Silver has peaked at 39.52 before falling. A brief attempt at a recovery on Monday and Tuesday has faded away thanks to Fed Chair Powell's comments yesterday.

A daily candle closed yesterday below the ascending trendline with further losses today.

The RSI period-14 on the daily chart has crossed below the 50 neutral level but remains some way off oversold conditions.

This means that further downside toward the 100-day MA at 34.60 could materialize.

Silver (XAG/USD) Daily Chart, July 31, 2025

Silver (XAG/USD) Price: Down 1.5% as Trendline Break Hints at Deeper Correction_1

Dropping down to the four-hour chart and the picture changes slightly.

The period-14 RSI is deep in oversold territory with a potential short-term pullback a real possibility.

Looking toward the upside, resistance is provided by the 200-day MA at 37.24 and the 100-day MA at 38.09.

A four-hour candle close above the 38.22 handle would invalidate a potential bearish setup in the near-term.

Silver (XAG/USD) Four-Hour Chart, July 31, 2025

Source: marketpulse

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Olivia Brooks

Economic

The number of Americans filing new applications for unemployment benefits increased marginally last week, suggesting that the labour market remained stable, though it is taking longer for laid-off workers to find new opportunities.

Initial claims for state unemployment benefits rose 1,000 to a seasonally adjusted 218,000 for the week ended July 26, the Labor Department said on Thursday. Economists polled by Reuters had forecast 224,000 claims for the latest week.

The labour market has slowed, with economists saying uncertainty over where President Donald Trump's tariff levels will eventually settle has left businesses wary of adding headcount. But labour supply has also declined amid the White House's immigration crackdown.

The Federal Reserve on Wednesday left its benchmark interest rate in the 4.25%-4.50% range, resisting pressure from President Donald Trump to lower borrowing costs. Fed chair Jerome Powell told reporters the labour market was in balance. But he added because that was partly due to both demand and supply declining, "we do see downside risk in the labour market."

The central bank cut rates three times in 2024, with the last move coming in December. Most economists expect it to resume policy easing in September.

Employers' hesitancy to increase hiring means there are fewer jobs for those being laid off. Government data on Tuesday showed there were 1.06 job openings for every unemployed person in June compared to 1.33 in January.

The number of people receiving benefits after an initial week of aid, a proxy for hiring, were unchanged at a seasonally adjusted 1.946 million during the week ending July 19, the claims report showed.

The claims data has no bearing on July's employment report, due on Friday as it falls outside the survey period. Non-farm payrolls likely increased by 110,000 jobs last month after rising 147,000 in June, a Reuters survey of economists showed.

The unemployment rate is forecast to rise to 4.2% from 4.1% in June.

Source: Theedgemarkets

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Risk Warnings and Disclaimers

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Adam

Commodity

Gold prices are slightly higher in early U.S. trading today, on some mild bargain hunting following recent selling pressure. Silver prices are sharply down and hit a four-week low, with weak long liquidation featured in the futures market. December gold was last up $5.30 at $3,358.60. September silver prices were last down $1.059 at $36.68.

It would not be surprising if strong selling pressure in silver futures is at least partly due to sympathy selling amid the big copper market meltdown seen the past two days. President Trump surprised the copper futures market with new tariff rules on copper imports, which dropped copper futures prices sharply lower. Broker SP Angel said in an email dispatch today: “Blood on the street (in copper futures) as Trump exempts refined copper from the 50% tariff he mentioned a while ago, with no immediate tariffs on copper or copper products.” Copper futures in the U.S. fell up to 6% overnight, extending the record 18% plunge Wednesday after Trump excluded refined copper from the tariff package that will start on Friday.

Asian and European stocks were mixed to higher overnight. U.S. stock indexes are pointed to higher openings when the New York day session begins, and at record highs.

In overnight news, Federal Reserve Chairman Jerome Powell shrugged off pressure from the White House and rejected arguments for an interest-rate cut from two dissenting Fed officials, saying the U.S. central bank needs to stay on guard against any problematic inflation. The Federal Open Market Committee voted to hold interest rates steady for a fifth consecutive meeting. However, this week’s meeting saw the first double dissent from Fed governors in more than 30 years. During his press conference, Powell said the Fed is well-positioned for now, given uncertainties surrounding U.S. tariffs and their economic impact. His comments were balanced, tempering expectations for a September rate cut, but not ruling out a cut at that time. Markets showed no major reactions to the FOMC/Powell news.

The Bloomberg Asia dollar spot index, which tracks the performance of a basket of leading Asian currencies versus the U.S. dollar, fell as much as 0.2% in early trading Thursday, to the lowest level since May 19. The Philippine peso led declines. The Indian rupee hovered near record lows. Regional currencies were set for their biggest monthly loss this year as the U.S. dollar has surged recently, including after the Federal Reserve held its benchmark interest rate steady Wednesday. Expectations for a September U.S. rate cut have also eased following recent upbeat U.S. economic data. Central banks across Asia have stepped up currency market intervention efforts to stabilize their own currencies. The Hong Kong Monetary Authority stepped in to buy HK$3.925 billion to defend its currency peg, while Indonesia’s central bank intervened in the foreign-exchange markets. The People’s Bank of China set a stronger-than-expected fixing to support the yuan.

Gold buying by central banks and jewelers eased in the second quarter amid the recent record high prices for the yellow metal. Central banks bought 166.5 tons in the three-month period, one-third less than in the first quarter, bringing purchases for the first half of the year to the lowest since 2022, according to the World Gold Council. Central bank demand is now forecast at about 815 tons for 2025.

The key outside markets today see the U.S. dollar index slightly higher. Nymex crude oil futures are weaker and trading around $69.50 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently at 4.35%.

U.S. economic data due for release Thursday includes the weekly jobless claims report, the Challenger job-cuts report, personal income and outlays, the employment cost index, and the Chicago ISM business survey.

Gold price slightly up as mild bargain buying featured_1

Technically, December gold futures bulls have the overall near-term technical advantage but have faded. Bulls’ next upside price objective is to produce a close above solid resistance at the July high of $3,509.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $3,300.00. First resistance is seen at Wednesday’s high of $3,389.30 and then at $3,400.00. First support is seen at this week’s low of $3,319.20 and then at the June low of $3,307.40. Wyckoff's Market Rating: 6.0.

Gold price slightly up as mild bargain buying featured_2

September silver futures bulls have the overall near-term technical advantage but are fading fast. A price uptrend on the daily bar chart has been negated. Silver bulls' next upside price objective is closing prices above solid technical resistance at this week’s high of $38.51. The next downside price objective for the bears is closing prices below solid support at $35.00. First resistance is seen at the overnight high of $37.285 and then at $38.00. Next support is seen at the overnight low of $36.28 and then at $36.00. Wyckoff's Market Rating: 6.0.