News

Silver’s surge helped close the performance gap between the two precious metals this year.

For all the attention on U.S.-China AI competition, new studies point to China’s rapid rise in biotechnology, especially for drug and agricultural development.

President Donald Trump held a phone call with China President Xi Jinping, Chinese media outlet Xinhua reported.

• Survey data points to some weaker prospects in the near term
• Higher tariffs, stronger euro to make exports harder
• Defense and infrastructure investment to bolster growth
• Boost in defense and infrastructure would raise inflation over the medium term
• Risks to growth tilted to the downside
• Not pre-committing to particular rate path
• In a good position to navigate uncertain conditions coming up
• There was one dissenter

I will update as headlines cross.

This article was written by Adam Button at www.forexlive.com.

U.S. Treasury yields held steady Thursday as investors weigh the state of the economy following a slate of disappointing U.S. data.

Trump and Xi held a phone call today, according to Xinhua.

That should be good news as the topics on calls like this are almost always pre-cleared and scripted.

It’s not exactly clear when the call was held or if it’s ongoing now but expect Trump to write about it on Truth Social soon after it’s over.

It’s tough to say exactly what’s priced in regarding any actions coming out of this. I don’t think the market is expecting tariff rates to drop but that would be an upside risks. At minimum, we’d expect them to undo some of the rare earth/chip curbs lately.

This article was written by Adam Button at www.forexlive.com.

As artificial intelligence becomes more capable, analysts warn that it could eliminate up to half of all entry-level white-collar positions across sectors, driving unemployment as high as 10–20% within the next one to five years. A January World Economic Forum survey, in turn, revealed that 41% of companies expect to reduce headcount due to AI automation by 2030.

At first glance, this transformation promises companies cost savings. But there’s a catch: who will be left to buy the products and services these companies sell if millions of people lose their income? The short-term gains from automation could backfire, undermine incomes, and trigger broader economic instability. For now, however, investors remain euphoric about AI.

In response to growing fears of human obsolescence, policymakers are floating the idea of an “AI tax,” essentially penalizing companies that aggressively replace workers with algorithms. But this raises another issue: what will prevent such companies from simply moving their operations to countries with less stringent regulations? Universal basic income is also on the table.

As the world struggles to figure out how to contain the economic disruption of AI, another threat is brewing that could shake up the global labor market by more familiar means: a slowdown in economic growth. According to the latest OECD report, the global growth forecast has been revised down to 2.9% for both 2024 and 2025 (from 3.1% and 3%, respectively).

The main reason? Donald Trump’s trade wars.

The International Labor Organization warns that renewed trade wars could jeopardize up to 84 million jobs in more than 70 countries and slow global employment growth. Not even the United States will be immune. According to the Federal Reserve Bank of Philadelphia, unemployment could rise from 4.2% this quarter to 4.5% by early 2026, up from a projected 4.3%.

What does all this mean for the markets?

Starting with the US, the OECD expects inflation to accelerate even as unemployment rises, averaging 3.2% in 2025 and 3.9% year-on-year in the fourth quarter. This would put the Fed in a difficult position to choose between keeping interest rates high and lowering them. A wrong decision could affect market confidence in the dollar (pushing the EUR/USD pair down) and U.S. treasuries.

For the rest of the world, massive job losses are a bad omen. When people lose jobs on a large scale, incomes fall, and so does purchasing power with less money circulating, as well as demand for goods and services contracts. This reduces business revenues, lowers investment, and often leads to even more layoffs — a vicious cycle. Stock and bond markets will soon react.

This article was written by FL Contributors at www.forexlive.com.

The 25-basis-point interest rate cut had been widely priced in by markets ahead of the ECB’s decision.

A model from AlixPartners shows what items like sweaters and shoes imported from Vietnam could cost under President Donald Trump’s tariff plans.

• Prior was $-0.51 billion (revised to $-2.26 billion)
• Exports $60.44 billion vs $69.90 billion prior (revised to $67.76 billion)
• Imports $67.58 billion vs $70.40 billion prior (revised to $70.01 billion)

This article was written by Giuseppe Dellamotta at www.forexlive.com.