EU and Chinese officials met in Brussels yesterday to confront a yawning €360 billion trade gap, agreeing to settle lingering trade disputes by an October deadline as both sides seek to cool mounting tensions over market access and industrial policy.
Currency markets were volatile. The yen plunged to a 40‑year low of 161.96 per dollar, stoking speculation about how far Tokyo will go to defend the currency and whether authorities have a new “red line” for intervention.
In policy developments, France’s inflation unexpectedly fell back within the ECB’s 2% target range, easing pressure on the central bank. Pierre Wunsch, a member of the ECB Governing Council, said the case for further rate hikes is now less compelling, a comment that helped temper expectations for imminent additional tightening.
Macro data from China provided a brighter backdrop for risk assets: manufacturing returned to expansion in June, driven partly by robust global demand for AI‑related equipment and components, signaling renewed momentum in industrial activity.
Markets were cautiously constructive. European equities rose about 0.8%. Asia presented a mixed picture: mainland China gained roughly 1%, Japan added about 0.5% and Hong Kong slipped 0.6%. US futures pointed to a largely unchanged open as Brent crude traded flat near $73 a barrel.
