U.S.-China Trade Talks Mark Major Breakthrough

Markets gain as key trade negotiations ease tensions; inflation and Fed moves stay in focus.

TL;DR:

• 🤝 U.S.-China trade talks show substantial progress
• 📊 Trump's tariffs drive U.S. inflation higher
• 🏦 Fed holds rates steady amid resilience
• 🌍 Trump launches Gulf business tour

U.S.-China Trade Talks Show Substantial Progress

U.S. Treasury Secretary Scott Bessent announced that negotiations with China have made “substantial progress,” raising hopes for a de-escalation in the protracted trade war. This development supported risk appetite across global equities, with investors anticipating potential relief for multi-national exporters and manufacturing sectors. Source

Trump's Tariffs Drive U.S. Inflation Higher

New data shows that tariffs imposed during former President Trump's administration are beginning to lift U.S. inflation, with April’s CPI expected to rise by 0.3% month-on-month. The upward pressure on prices is fueling debate over the long-term impact of trade policies and could complicate the Federal Reserve’s path ahead. Source

Fed Holds Rates Steady Amid Resilience

The Federal Reserve left its benchmark rate unchanged at 4.25%–4.5%, citing a robust labor market and steady economic activity. The decision signals a wait-and-see approach as policymakers monitor inflation trends and global developments, keeping market participants focused on upcoming data releases. Source

Trump Launches Gulf Business Tour

Former President Trump began a high-profile business tour of the Gulf, visiting Saudi Arabia, Qatar, and the UAE. The trip coincides with significant U.S. investment commitments from the region, highlighting the growing economic ties and potential deal flow between U.S. businesses and Middle Eastern investors. Source