Tencent, JD.com, And Hon Hai Face Pressure From New US Tariffs.

China–U.S. Trade War

Economic

Summary:

Even as relations between the US and China show slight improvement, Chinese tech giants continue to feel the heavy impact of the trade tariffs.

Chinese tech giants, including Tencent, JD.com, and Hon Hai, face mounting pressure from new U.S. tariffs, threatening to slow their growth ambitions. While the companies are pouring resources into AI to drive expansion, higher trade barriers put them at a disadvantage compared to global rivals with easier market access.These Chinese companies expect lower earnings after President Trump announced new tariffs in April. As they boost AI spending, they may reduce stock buybacks, which could hurt short-term profits.

US tariffs reduce profits as tech giants shift focus to AI

Even as relations between the US and China show slight improvement, Chinese tech giants continue to feel the heavy impact of the trade tariffs.The trade barriers targeting semiconductors and other important tech imports create uncertainty around profits and future growth for companies like Tencent, JD.com, and Hon Hai. Their earnings expectations have dropped because they still operate under intense cost pressure and are more exposed to these tariffs than their global competitors.

Hon Hai Precision Industry Co. is a Taiwan-based electronics manufacturer known for its partnership with Nvidia and its large role in global chip production. The company reported a slowdown in sales growth in July due to President Donald Trump’s proposed 100% tariff on Chinese-made chips. However, its investments in US-based data center infrastructure bring optimism about its long-term prospects in AI.Still, their momentum in the short run could be limited due to the weak near-term demand for consumer electronics such as smartphones and personal computers.

As for Tencent, its next earnings report is expected to show net income growth of just 7.3%. This is the slowest rate it has seen in six quarters despite steady gains in its core advertising and video game businesses. The company’s AI initiatives are still in early stages and have yet to impact revenue. Analysts say its current business model relies heavily on its existing services, which could be the reason for Tencent’s slowdown.The company hopes that upcoming game releases, like Valorant Mobile and Honor of Kings: World, will help boost user engagement and improve future earnings.

Meanwhile, JD.com’s double-digit growth across its retail, logistics, and emerging business segments contributed to its relatively strong numbers, with second-quarter revenue rising 15%. This shows the company is finding ways to adapt and grow even in a difficult economic climate. Still, analysts say the drag caused by ongoing tariffs continues to affect both domestic confidence and international trade flows, slowing China’s overall consumer spending.

Chinese firms face local competition while chasing AI goals

The Chinese government is now pushing back on “monopolies” like JD.com, Alibaba, and Meituan in China’s large and fast-moving food delivery market. Authorities want them to stop “disorderly competition,” as seen in their aggressive pricing, unsustainable discounts, and market behavior that harms smaller players and destabilizes the industry.The companies responded, promising to tone down these tactics and work toward fairer competition. This move will likely hurt short-term revenue growth for firms that had leaned heavily on aggressive pricing to gain market share, even though it may support long-term industry health.

The targeted companies are also increasing their investments in artificial intelligence. Analysts say AI-related spending is starting to take precedence over shareholder-focused actions like stock buybacks. These firms risk weakening their short-term financial performance (a major concern for investors looking for immediate returns) by redirecting funds toward long-term innovation.Many Chinese are moving forward with the initiatives despite the risks and uncertainties. For example, Hon Hai recently sold its Ohio electric vehicle factory for $375 million. Analysts say the move aligns with the company’s strategy to focus more on North America’s data center technology and artificial intelligence infrastructure.

JD.com is also expanding its logistics capabilities and broadening its product offerings beyond traditional retail. At the same time, Tencent continues to rely on its strong gaming and advertising platforms to fund its AI development.

Source: CryptoSlate

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

You understand and acknowledge that there is a high degree of risk involved in trading. Following any strategies or investment methods may lead to potential losses. The content on the site is provided by our contributors and analysts for information purposes only. You are solely responsible for determining whether any trading assets, securities, strategy, or any other product is suitable for investing based on your own investment objectives and financial situation.

Add to Favorites

Adam

Economic

The US dollar weakened to a 10-day low after President Donald Trump announced his intention to nominate Stephen Miran to fill a vacant seat on the Federal Reserve’s Board of Governors. The move, while procedural on the surface, may have deeper implications for monetary policy, institutional independence, and the future trajectory of the US dollar.

On Thursday, the US Dollar Index (DXY) fell 0.2% to 98.196, after touching a session low of 97.945. This decline adds to a broader downward trend that has been accelerating following weak employment data and growing expectations of another rate cut by the Federal Reserve in September.

Miran’s Policy Views Raise Red Flags for Fed Independence

Stephen Miran currently serves as chair of the White House’s Council of Economic Advisers. He is widely known for his hawkish criticism of the Fed’s institutional autonomy, having previously argued in favor of greater presidential oversight over central banking operations.

In published writings, Miran has questioned the very foundation of the Fed’s independence, claiming that “central banks ought not to operate in a vacuum from elected leaders.” His alignment with President Trump’s more interventionist monetary stance is already prompting concern in financial markets.

Analysts at Danske Bank noted:

"Miran has expressed skepticism about the Fed’s independence and has argued for stronger presidential control over the Fed Board."

This perceived ideological alignment with Trump—who has long favored ultra-low interest rates—could alter the future balance of power within the Fed and influence rate-setting decisions heading into a contentious election cycle.

The Mar-a-Lago Accord: A Blueprint for a Weaker Dollar?

Perhaps most striking is Miran’s authorship of the Mar-a-Lago Accord, a proposed policy framework designed to weaken the US dollar deliberately. The plan aims to boost American exports, reduce trade deficits, and make US manufacturing more competitive by promoting a weaker currency through coordinated policy actions.

Though not officially adopted, the plan gained traction among Trump’s economic allies as a counterweight to what they perceived as “currency manipulation” by trade partners like China and the European Union.

Miran’s nomination revives market fears that the administration may attempt to implement elements of this strategy in practice, particularly now that Trump-aligned voices may reshape the Fed.

Broader Market Implications: Interest Rates, Tariffs, and Capital Flows

The dollar’s decline comes amid a broader re-pricing of interest rate expectations. After July’s disappointing nonfarm payrolls report and significant downward revisions to previous months’ data, markets now place a growing probability on a rate cut in September. Comments from Fed officials Neel Kashkari and Mary Daly this week only reinforced that dovish tilt.

In this context, Miran’s nomination is viewed as part of a broader push to institutionalize easier monetary policy and currency devaluation. Investors fear that if Miran is confirmed and the Fed leans toward politically motivated easing, it could undermine long-term confidence in the dollar’s value and global reserve status.

Additionally, Trump’s newly enacted reciprocal tariffs against dozens of countries further complicate the macroeconomic landscape. Tariffs tend to be inflationary, which would typically argue for tighter policy. But if Miran joins the Fed and endorses cutting rates amid rising import prices, it would mark a dramatic break from orthodoxy.

Institutional Uncertainty and Market Volatility

The Federal Reserve is already walking a fine line—balancing cooling inflation against weakening growth and labor market softening. The addition of a Fed governor who favors executive branch control and a weaker dollar could heighten institutional uncertainty and market volatility.

The risk isn’t just about one nomination. If this marks the beginning of a broader reshuffling of the Fed to align with the executive’s political goals, it may erode investor trust in the central bank’s long-term credibility.

Historically, markets have punished such interference. In the 1970s, political pressure on the Fed contributed to runaway inflation and a deep recession. While the current situation is not identical, the risks of miscalibrated policy responses are not negligible.

Conclusion: A Weak Dollar, Stronger Political Grip?

Stephen Miran’s potential confirmation could catalyze a paradigm shift at the Federal Reserve—away from data-driven independence and toward politically influenced policymaking. His prior advocacy for a weaker dollar, coupled with his doubts about central bank autonomy, suggest that the US may be entering a new phase of politicized monetary strategy.

For now, markets are adjusting accordingly: the dollar is slipping, bond yields are dipping, and traders are positioning for dovish policy ahead. But the bigger question looms—can the Fed retain its independence in an era where political control over interest rates is once again becoming a campaign issue?

Source : investing

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

Add to Favorites

Michelle

Economic

Forex

Bank of England Chief Economist Huw Pill warned the central bank may need to slow its once-a-quarter pace of interest-rate cuts after a resurgence in inflation that risks changing the behavior of households and businesses.

Pill — who opposed the BOE’s closely contested decision on Thursday to cut rates by a quarter point — said a spike in price pressures may linger for longer than expected, pointing to the impact on household expectations from climbing food bills.

He said in an online briefing on Friday that mounting inflation risks “might lead us to have to question whether the pace at which we’re reducing bank rate over the last year, a pace of one quarter-point cut every quarter, is as sustainable.”

The comments will add to mounting doubts over whether the BOE will cut rates again this year after Thursday’s narrow five to four vote to reduce borrowing costs. Traders now see the odds of a move in November at below 50-50, threatening to end the series of quarterly cuts since last August.

While the benchmark rate was lowered to 4% after an unprecedented second vote to break a deadlock on the Monetary Policy Committee, the opposition to a cut was larger than economists expected. Pill and Deputy Governor Clare Lombardelli were among the four dissenting policymakers.

Governor Andrew Bailey also said following the decision there is “genuine uncertainty now about the course of that direction of rates.”

The BOE now expects inflation to peak at 4% in September, double the 2% target and up from a previous projection of 3.7%. Officials are growing more concerned about the potential for second-round effects where workers seek to recover lost purchasing power through wage demands, with a knock-on impact on prices.

“At the margin I think there is a view among the committee that there has been some shift in the balance of risks to inflation at the two-to-three year horizon,” Pill said. “There’s still a little bit further downward to go with bank rate. I think the pace at which those downward moves perhaps going forward is a little bit less clear than the pace that we’ve seen over the last year.”

He cautioned: “There is a risk, because of this salience of food prices for inflation expectations, that it might spill over into more persistent inflation dynamics.”

“A slightly more concerning interpretation of the shift in the risks around inflation to the upside would be one that puts more emphasis on changes in behavior, in price-setting behavior, in wage-setting behavior of a more lasting nature,” he said.

Pill said rates are approaching the upper end of the range of where the BOE believes the neutral rate — where policy is neither stimulating or pulling down inflation — to be.

“Where precisely that rate is, I think is a difficult challenge,” he said. “The MPC has made various statements in the past. Its most recent set of statements have been well that rate probably lies somewhere in the range of 2% to 4% in nominal terms, so we are now beginning to approach that range.”

Source: Bloomberg Europe

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

Add to Favorites

Adam

Commodity

Market Overview

Gold eased in Asian trading on Friday, retreating from a two-week peak as profit-taking and a modest rebound in the US dollar weighed on sentiment. The dollar’s recovery from its recent two-week low, combined with a rally in Asian equities, heading for their strongest weekly performance since June, curbed short-term demand for the metal.

A stronger greenback makes gold more expensive for non-dollar buyers, often prompting a pause after price rallies. Still, expectations of US monetary easing remain a key source of support. Futures markets now price in over a 90% probability that the Federal Reserve will cut rates in September, with traders anticipating at least two reductions before year-end.

The shift in outlook followed a softer US jobs report and data showing initial jobless claims rose to 226,000 last week, the highest since early July. “Labor market softness reinforces the case for the Fed to pivot sooner,” one commodities strategist noted, suggesting any pullback in gold could be shallow if policy easing materializes.

Silver Consolidates as Profit-Taking Emerges

Silver also traded softer, with prices easing from recent highs as investors locked in profits. The metal, often benefiting from both industrial and safe-haven demand, saw headwinds from the firmer dollar and stronger risk sentiment in equity markets.

Still, ongoing geopolitical uncertainty and expectations of US rate cuts continue to underpin its longer-term outlook.

Analysts note that silver’s dual role in the green energy sector, through its use in solar panels and electronics, may keep investment demand resilient, especially as governments accelerate renewable energy targets.

Central Bank Buying and Policy Uncertainty Offer Long-Term Support

In a notable supportive trend, China’s central bank extended its gold-buying streak to nine consecutive months in July, reinforcing institutional confidence in bullion. Central bank purchases, alongside rising geopolitical and trade frictions, add a stabilizing layer to gold’s fundamentals.

Recent US tariff hikes on Indian imports and new duties targeting semiconductors and pharmaceuticals have reignited concerns of broader trade disruptions, sustaining interest in safe-haven assets.

With no primary US data scheduled, traders will watch upcoming Federal Reserve commentary for signals on the pace of monetary easing, a key driver for both gold and silver in the months ahead.

Short-Term Forecast

Gold (XAU/USD) holds near $3,396 above trendline and EMA support at $3,362–$3,354, eyeing $3,413 resistance. Silver (XAG/USD) trades at $38.37, targeting $38.76, with support at $38.28 and $37.61.

Gold Prices Forecast: Technical Analysis

Gold – Chart

Gold (XAU/USD) is trading around $3,396, holding above trendline support from the August 1 rebound. The 50-EMA ($3,362) and 100-EMA ($3,354) are providing a solid bullish base, while price consolidates just below the $3,413 resistance.

A sustained break above this level could open the path toward $3,436 and $3,458. On the downside, immediate support lies at $3,371, with a deeper pullback eyeing $3,344 if momentum weakens. The ascending trendline suggests ongoing buying interest, but failure to clear $3,413 may trigger profit-taking.

Silver (XAG/USD) Price Forecast: Technical Outlook

Silver – Chart

Silver (XAG/USD) is trading near $38.37, holding above trendline support from the August rebound. The 50-EMA ($37.81) and 100-EMA ($37.77) have turned supportive, signaling improving bullish momentum. Immediate resistance is seen at $38.76, a breakout above which could open the door toward $39.16 and $39.52.

On the downside, $38.28 is key intraday support, followed by $37.61 if sellers regain control. The recent strong rally and higher lows pattern suggest buyers remain in control, but rejection at $38.76 could trigger a pullback toward the EMAs.

Source: fxempire

Risk Warnings and Disclaimers

Add to Favorites

Adam

Commodity

Economic

A US move to put tariffs on imports of gold bars is unleashing fresh turmoil in the bullion market, with prices spiking in New York as dealers brace for a major reordering of global trade flows.

US Customs and Border Protection has clarified that one-kilogram and 100-ounce gold bars are subject to reciprocal tariffs enacted by President Donald Trump, and are not exempted as the industry had initially understood, according to a letter from the agency seen by Bloomberg. The ruling was first reported by the Financial Times.

Gold futures in New York — which are backed by those forms of bullion — surged to a record high, as traders, analysts and executives across the industry were left reeling. The move threatens to disrupt shipments from Switzerland and other key trading and refining hubs including Hong Kong and London, where prices are now trading at a big discount to the US market.

Traders and analysts are scrambling to understand the full scope and consequences of the ruling, including whether the CBP would treat larger 400-ounce bars that underpin trading in London in the same way, and what the levies for major gold-producing countries will be. The potential market consequences are so profound that some questioned whether the dramatic change could be an error on the CBP’s part, and suggested it may be subject to legal challenges.

“In the long run, the existence of US tariffs on deliverable gold products raises the question on the role of futures trading in the US,” said Joni Teves, a strategist at UBS AG. “Until there is clarity, we expect the gold market and precious metals markets more generally to remain very nervous.”

The ruling came in response to an inquiry from a refiner in Switzerland, which plays a particularly crucial role in the smooth functioning of the global market. If prices in London and New York move out of lockstep, Swiss refiners can melt down the larger bars that are traded in the UK capital so they can be delivered against US futures contracts, and vice versa.

US monthly gold imports surged to a high of 43 tons in January this year, as traders raced to ship metal to the US ahead of any possible tariffs. That compares to average monthly production by gold refiners in the US of 22 tons last year, according to US Geological Survey data.

Bullion traders had expected gold bars of one kilogram and 100 ounces qualified for an exemption from Trump’s reciprocal tariffs, including the shock 39% country rate he put on Switzerland. But in the letter sent on July 31 the CBP clarified that those products are classified under customs codes covering semi-processed goods that are subject to levies.

“Gold is moved back and forth between central banks and reserves around the world,” said Robert Gottlieb, a former precious metals trader and managing director at JPMorgan Chase & Co., referring to the bars. “We never ever thought that it would be hit by a tariff.”

The Trump administration has delivered many shocks as it builds a complex patchwork of different US import tariffs launched for varying reasons at different rates. Last month, US copper futures crashed after the White House unexpectedly spared refined metal — the most widely-traded product — from a 50% levy.

Managers at two major gold refineries in Asia, who did not want to be named discussing sensitive information, said they are pausing shipments to the US until there is more clarity on the tariffs.

One-kilo gold bars are the most common form traded on Comex, the world’s largest gold futures market, and comprise the bulk of Switzerland’s bullion exports to the US. The country’s gold exports have become a flashpoint in its trade negotiations with the US, after a surge in shipments earlier this year caused the US’s trade deficit with the country to spike.

The levy could add to troubles for Swiss President Karin Keller-Sutter after Trump handed Switzerland the highest country tariff among developed nations. She made an emergency trip to Washington on Thursday aimed at swaying the White House, but came away empty-handed after being denied a meeting with Trump.

Dramatic Change

The latest ruction adds to a tumultuous year for gold, and drove a spike in the premium of gold futures in New York over international prices on Friday. Contracts for December delivery jumped to a premium of more than $100 an ounce above the global benchmark for spot prices in London, as investors bet on the tariffs snarling imports.

Imports and exports for all countries are classified by an intricate system of codes that are used to set the scope of any levies.

The CBP letter said the gold bars fall under code 7108.13.5500 rather than the non-tariffed 7108.12.10 as expected. That classifies them as a “semi-manufactured” rather than “unwrought” type of gold, according to the US International Trade Commission’s website.

It’s unclear whether other types of gold bars, such as 400-ounce bullion that’s the most-traded in London, will be subject to tariffs. If not, those could simply be shipped to the US and recast into one-kilogram blocks, said a manager of a major refinery, who declined to be named as they are not authorized to speak publicly.

Such a scenario would still render the CME contract unviable, according to Nikos Kavalis, managing director at consultancy Metals Focus Ltd, since the US only has limited gold refining capacity.

“The gap between the spot price and the futures price will be prone to issues of capacity. I just don’t see that as being in anyone’s best interest,” he said. “I suspect that this is a misunderstanding or an error on the part of the customs authorities, or if not an error, let’s say a poor assessment. I suspect it’ll be legally challenged or lobbied.”

Source : Bloomberg

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

Add to Favorites

Glendon

Economic

Commodity

The price of gold futures have soared to a record high after it was reported that the US would put tariffs on imports of 1kg bars in a further trade blow to Switzerland, which dominates the world’s refining industry.

Swiss exports to the US were hit by a crippling 39% tariff on Thursday after the country’s president returned empty-handed from a last-minute dash to Washington in an attempt to get the rate, among the highest imposed by Donald Trump, lowered.

It has subsequently emerged that US customs recommended that certain imports of gold bars that had been in a tariff exemption category should also be covered by the 39% rate.

The detail in a ruling letter – used by the US to clarify its trade policy – was signed on 31 July and seen by the Financial Times.

The price of gold futures for delivery in December hit an all-time intraday high of $3,534 (£2,630) after the news emerged.

Christoph Wild, the president of the Swiss Association of Manufacturers and Traders of Precious Metals, told the Financial Times that the ruling dealt “another blow” to the Swiss gold trade with the US and went against the prevailing view that gold would be exempt.

With about 70% of the world market, Switzerland dominates the trade of turning gold from mines and other sources into gold bars. The precious metal is also one of its biggest exports to the US along with pharmaceuticals.

The gold trade is usually circular between London, New York and Switzerland, with bars cast and recast in different sizes according to orders.

Switzerland imports about 2,000 tonnes of gold annually, much of it from intermediary banks in London, New York and elsewhere, which are later exported as gold is seen as a safe haven investment at a time of financial uncertainty.

In the 12 months to June, Swiss exports of gold to the US were worth about $61.5bn and this now faces an extra levy of 39%. Switzerland’s rate is among the highest in the world, after Brazil, Syria, Laos and Myanmar.

Gold prices had already jumped about 25% this year as investors sought a safe haven from the turmoil caused in the markets by Trump’s tariffs.

High net worth Americans are among those turning to physical gold, which can be held in vaults in the Swiss Alps for an extra cost.

According to reports, gold bars were in such demand in the US in May after Trump’s announcement of sweeping “reciprocal” tariffs the previous month that Costco capped how many gold bars could be bought in a day.

Switzerland has been blindsided by Trump’s decision to single them out for punitive tariffs and industry leaders are already talking about the possibility of imposing short working weeks on workers in export businesses.

Source: Kitco

To stay updated on all economic events of today, please check out our Economic calendar

Risk Warnings and Disclaimers

Add to Favorites

Warren Takunda

Economic

Central Bank

The Bank of England was set free from the Government by Gordon Brown in 1998, but 27 years later and his Labour Party successors are compromising that independence.

Following Thursday's 25 basis point interest rate cut, the Prime Minister, Chancellor of the Exchequer and Labour parliamentarians ran a series of coordinated social media posts taking credit for the 25 basis point reduction in interest rates.

"Good news: interest rates have been cut five times since we came into government. Homebuyers are £1000 better off on their mortgages than they were a year ago. That's our Plan for Change in action," said Prime Minister Keir Starmer following the decision.

"Since the General Election, interest rates have been cut five times and are now at their lowest level for two years - bringing down the cost of mortgages and loans across the UK. By bringing stability back to the country's finances we're putting more money in people's pockets," said Chancellor Rachel Reeves.

A study of their social media posts and press appearances reveals the messaging is not new and that the administration has been steadily tying Bank of England policy decisions to government policy.

This marks a departure from previous governments - both Labour and Conservative - that avoided regular commentary on Bank of England policy making, let alone taking credit for any policy moves.

The developments in the UK are contextualised by U.S. President Donald Trump's more overt attempts to influence the Federal Reserve, which have raised risk premiums on U.S. assets in 2025, contributing to the decline in the Dollar.

The Pound faces similar risks from Starmer and Reeves' attempts to convince the public that government and central bank policy are aligned and coordinated. Bank of England Independence Jeopardised By Starmer_1

Bank of England Independence Jeopardised By Starmer_1

Image shows official Labour Party messaging following Thursday's interest rate decision.

Investors are intrinsically more trustful of institutions that are deemed to be independent of politics, judging that technocrats are better decision makers than politicians who operate in short-term, four-year cycles.

For Pound Sterling, any building risk premium associated with questions of central bank credibility would therefore prove costly.

There is a growing risk that future interest rate decisions are compromised by political associations. We might already be seeing this: economists and financial market commentators are questioning why the Bank's governor, Andrew Bailey, went against his Chief Economist and Deputy Governor for Monetary Policy by voting for a cut.

The two professional economists on the Monetary Policy Committee (MPC) saw a cut as being too risky given that inflation is rising, and could soon reach 4.0%, which is double the Bank's target.

"Confused about what’s going on at the Bank of England? You should be. Higher inflation normally requires high or increasing interest rates. But now, higher inflation means lower interest rates. No surprise that 4 of 9 MPC members voted against this policy move. What a muddle!" says Andrew Sentance, an economist who formerly served on the MPC.

"Bailey has already been caught out loosening policy too much when inflation is rising - back in 2nd half of 2021 and early 2022. He is making the same mistake again, when his Deputy Gov for Monetary Policy and Chief Economist are urging a more cautious policy," he adds.

There's a risk that consumers and businesses perceive Bank of England policy as being politically motivated, undermining the perception that it is a credible stalwart in fighting inflation.

A belief that there is no longer a controller of inflation would encourage workers to press for higher wages and businesses to raise prices, which would add momentum to the inflationary cycle.

Reeves and Starmer's attempt to draw an association with the central bank rests with the populist undertones that come with lowering interest rates: it's stimulatory and is intended to boost the economy and jobs.

But a truly independent central bank would realise that making unpopular decisions is entirely within its remit: rising unemployment is sometimes a necessary trade-off central banks must make in order to control inflation. They're not here to be popular, they're here to deliver for the greater good, and nothing compromises the greater good more than inflation does.