Daily Brief Macro: Inconsistently Dovish Pricing and more

• Dovish market fears from April have unwound for the Fed, yet deepened for the BoE, despite broadly resilient data and cautious guidance from policymakers reluctant to cut.
• Equity prices have relied on this resilience to recover, yet expectations for extended rate-cutting cycles imply it breaks. Payrolls only forced half of the gap to close.
• We expect ongoing resilience to keep rolling market pricing for rate cuts later, with the unnecessary easing ultimately never being delivered by the BoE, Fed, or ECB.

• Trump offers another three weeks of reprieve on reciprocal tariffs with an extension of the deadline to 1 Aug from 9 July
• Tariffs remain cumbersome for Asia despite some reductions. Japan and Malaysia see 1ppt increase.
• Ongoing development reinforce our core views of a slowdown in H2 and more monetary easing. However, relative forecasts are subject to re-evaluation.

• Global upstream oil and gas development spending is expected to decline by about 1.1% to $543 billion, with reductions in all regions except the Middle East
• Major Chinese National Oil companies, US E&P operators, and Russian companies like Gazprom are all cutting their capital spending in response to lower oil prices and increased costs due to tariffs
• Despite strategic shifts towards low carbon projects, there is a significant reduction in investment in these areas, with upstream investment not seeing any benefits

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• Market participants should look at a bigger picture view of positioning in US equities, rather than narrow metrics like IMM or market participants only
• European countries, as well as Canada and Australia, are large holders of US equities, with pension funds being major players
• Australian pension funds have over 800 billion in US equities, with a flow rate of 1.2% of GDP going into foreign equities, and have low FX hedge ratios which could be raised in the future

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• Overall bearish market conditions in China
• Mixed trade data underscore tepid demand conditions
• Arbitrage window might open as spread between Chinese and international prices narrows 

• U.S. Copper Market Gap: 1.3 Mt refined copper supply gap due to limited 0.4 Mt refining capacity against 1.7 Mt demand, despite 1.1 Mt mined ore.
• Impact on Market and Users: 50% tariff may raise prices 15–25%, adding $200–400/vehicle and 3–5% construction costs, while boosting refining investment.
• Way Forward: Expand refining capacity, streamline permitting, and ensure policy stability to process exported ore and cut import reliance by 2030.

• COMEX spreads blew out to over 2,500 USD/ton (a ~25% premium) last night as President Trump announced a likelihood of a 50% import tariff on the metal. 
• We believe this move will deplete inventories further at the LME (to be shipped to the COMEX) and lead to a rally in copper prices on the LME as well.
• Follow our prior insight, Copper Breaches 10k USD: Easy Journey to 11k USD/Ton On Lower Inventories In The Short Term 

• The podcast episode discusses the shift towards systematic global macro investing and the advantages of using quantitative models and algorithms.
• The sources highlight the importance of technology and data in driving this shift, but also emphasize the value of human judgment in certain situations.
• Listeners are encouraged to explore the freely available Google Colab Jupyter notebook for replicating sector performance analysis discussed in the episode.

This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.

• Property / Cover Story: Developers impose deeper ‘haircuts’ on creditors in latest debt overhauls
• Livestreaming /In Depth: China’s livestreaming apps face a reckoning over gambling
• Refugees /: Global displaced population hits record as UN refugee agency faces funding cuts

• The RBA surprised markets by maintaining the cash rate at 3.85%, rejecting consensus expectations for a cut and citing the need for further confirmation that inflation is sustainably on track to the 2.5% midpoint.
• The decision reflects persistent uncertainty in the global economic environment and a domestic outlook characterised by robust labour market conditions but only gradual recovery in household demand, with risks on both sides of the inflation outlook.
• The Board’s split vote and explicit data-dependent stance signal that future interest rate decisions will be highly sensitive to forthcoming inflation and labour market data, as well as evolving international developments.