Bloomberg Evening Briefing Asia |
|
The European Union has been the target of some of US President Donald Trump's harshest rhetoric over trade. On Friday, he threatened to impose a higher, 50% tariff on the EU starting June 1 after complaining the bloc was slow-walking negotiations and unfairly targeting US companies with lawsuits and regulations. But he softened his tone after what he described as "a very nice call" with Commission President Ursula von der Leyen over the weekend. In it, he agreed to extend the deadline for the bloc to face 50% tariffs until July 9. Trump's 50% tariff threat would hit $321 billion worth of trade between the US and the EU, lowering American GDP by close to 0.6% and boosting prices by more than 0.3%, according to Bloomberg Economics calculations. Trump also appears to have undergone a mood shift on Russia over the weekend but in the opposite direction. He said he was "absolutely" considering new sanctions against Russia, after Moscow launched a second night of deadly missile and drone strikes across much of Ukraine. He took to social media to say that Russian President Vladimir Putin "has gone absolutely CRAZY!" Trump's increasing frustration over the state of ceasefire talks raises the likelihood of further US sanctions, with the possibilities including action against Russia's oil trade or oil company Rosneft. —Samson Ellis | |
What You Need to Know Today | |
China is working on a new master plan to boost production of high-end technological goods. Officials are drawing up plans to prioritize technology including chip-making equipment, according to people familiar with the matter. The proposal would be an updated iteration of Xi Jinping's flagship "Made in China 2025" campaign and signals Beijing's intention of keeping a firm grip on critical industries as Trump looks to bring more factories back to the US. Chinese President Xi Jinping at the National People's Congress in March. Photographer: Qilai Shen/Bloomberg | |
|
Nippon Steel shares surged more than 7% in Tokyo after Trump appeared to give his blessing to the company's 17-month pursuit of United States Steel Corp. on Friday. He lauded the "planned partnership", claiming it would create "at least 70,000 jobs" and add $14 billion to the US economy. The president injected some uncertainty to proceedings on Sunday however, when he said the new entity would be controlled by the US. The Japanese government is still awaiting a formal announcement, according to a senior Cabinet official. | |
|
Malaysian Prime Minister Anwar Ibrahim has personally written to Trump, asking for a meeting with Southeast Asian nations over US tariffs. Anwar warned that a transition in the geopolitical order is underway and that the tariffs had put the global trading system under strain. He made the remarks at the opening of an ASEAN summit in Kuala Lumpur. | |
|
Chinese electric vehicle heavyweight BYD triggered fears of a renewed price war in the industry. The company announced sweeping price cuts of as much as 35% on 22 models until the end of June. Morgan Stanley analysts said the move was a "strong signal of how tough the end market is." Shares of EV makers fell in Hong Kong. A BYD Seagull electric vehicle at the Shanghai Auto Show in April. Photographer: Qilai Shen/Bloomberg | |
|
OpenAI plans to open an office in South Korea. The ChatGPT-maker is hiring staff to support partnerships with companies and policymakers, it said. It would be OpenAI's third office in Asia, following Japan and Singapore. South Korea has the largest number of paying ChatGPT subscribers outside the US, according to OpenAI. | |
|
Shifting US trade and immigration policies are making it difficult for policymakers to move on interest rates before September, Minneapolis Federal Reserve President Neel Kashkari said in an interview on Bloomberg TV in Tokyo. Kashkari and his peers have said the bar remains high for cutting interest rates in the near term. But if trade deals are struck between the US and other nations over the next few months, "that should provide a lot of the clarity we are looking for," he said. | |
|
Japan aims to slash the soaring price of rice by unloading government stockpiles into the market. The government plans to release an additional 300,000 tons of rice at a fixed wholesale price, according to the newly-appointed agriculture minister. That should bring the retail price down by about half, the ministry said. The push to curb the runaway price of the staple, which has doubled in the past year, comes as consumers feel the pinch from rising living costs ahead of a key parliamentary election this summer. Rice on sale in Japan. Photographer: Soichiro Koriyama/Bloomberg | |
What You'll Need to Know Tomorrow | |
|
|
Japan's largest life insurers are in a tricky position. Not only have they been left holding billions of dollars in paper losses from the market rout sparked by Trump's policies, they're also nervously eyeing a central bank that's looking for opportunities to raise interest rates. This has burdened the country's four largest insurers, Meiji Yasuda Life, Sumitomo Life, Dai-ichi Life and Nippon Life, with about $60 billion of combined unrealized losses on their domestic bond holdings for the latest fiscal year. Still they're not worried just yet. Unrealized bond losses don't necessarily lead to actual selloffs because insurers tend to hold notes until they mature. Also, a new rule means higher interest rates push down the value of both assets and liabilities and don't affect a regulatory gauge of fiscal soundness. There's still "some distance" until unrealized losses increase so much that writedowns on the value of bonds are needed, according to one senior executive at Meiji Yasuda Life. He doesn't expect the surge in super-long Japanese yields to continue. The Meiji Yasuda Life Insurance headquarters in Tokyo, Japan. Photographer: Kiyoshi Ota/Bloomberg | |
Enjoying Evening Briefing? Check out these newsletters: - Markets Daily for what's moving in stocks, bonds, FX and commodities
- Breaking News Alerts for the biggest stories from around the world, delivered to your inbox as they happen
- Balance of Power for the latest political news and analysis from around the globe
- India Edition for an insider's guide to the emerging economic powerhouse
- Hong Kong Edition for what you need to know from the Asian finance hub
Explore all newsletters at Bloomberg.com. | |
|
Like getting this newsletter? Subscribe to Bloomberg.com for unlimited access to trusted, data-driven journalism and subscriber-only insights. Before it's here, it's on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can't find anywhere else. Learn more. Want to sponsor this newsletter? Get in touch here. | | You received this message because you are subscribed to Bloomberg's Evening Briefing: Asia newsletter. If a friend forwarded you this message, sign up here to get it in your inbox. | | |