In today’s briefing:
- US Inflation Skips Several Months
- UK Jobs Suggest Summer Stabilisation
- Asian Equities: Cyclical Return Patterns – a Long-Term Analysis
- CX Daily: Trump’s Tariff-by-Tweet Tactics Are Pushing Global Trade Into Perpetual Uncertainty
- India: Continuing Disinflation Highlights RBI’s Renewed (Mild) Policy Error
- Lee Jae-Myung to Meet Trump: Impact on North Korea Economic Reconciliation Stocks
- Actinver Research – Macro Daily: Industrial Activity (June 2025)
- RBA Cuts as Productivity Concerns Grow
US Inflation Skips Several Months
- July’s US inflation print reversed all of the increase built in from tariffs over the past several months, despite matching expectations prevailing into the release.
- Core goods inflation eased slightly, suggesting ongoing corporate success in avoiding the tariff shock. But service inflation is stuck too high to be consistent with the target.
- Anti-avoidance measures and belated pass-through will drive further rises. We doubt they will be as severe as many fear, yet still not create much space to cut rates.
UK Jobs Suggest Summer Stabilisation
- Unemployment broke a four-month streak of increases at 4.66%, with favourable cohort effects risking a fall soon. Payrolls may also be revised to grow again from July.
- The structural hit from tax increases is matched by the cumulative fall in payrolls so far. Fundamental explanations for its divergence from the LFS aren’t supported yet.
- Ongoing resilience in wage growth stokes unit labour cost pressures alongside taxes that are beyond the target. We still expect the MPC to resist cutting rates again.
Asian Equities: Cyclical Return Patterns – a Long-Term Analysis
- Analyzing Asian markets’ long term return cyclicality, we notice that the durations of upcycles and downcycles vary across markets. Within the same market, often the upcycle and downcycle durations differ.
- We conclude that in Q4 2025, Korea, Taiwan and Philippines are likely to move up. Hong Kong, India, Indonesia, Thailand and Singapore seem likely to decline.
- An obvious caveat is: this method of predicting returns involves purely pattern recognition, not fundamental reasoning. While the markets mostly adhere to the observed patterns, they don’t always do so.
CX Daily: Trump’s Tariff-by-Tweet Tactics Are Pushing Global Trade Into Perpetual Uncertainty
- Trump’s tariff-by-tweet tactics are pushing global trade into perpetual uncertainty
- President Donald Trump’s trade policy has entered a new, chaotic phase, where structured negotiations give way to abrupt threats and legally nonbinding agreements that have left global commerce in a state of constant tension.
- After several delays, Trump’s “reciprocal tariffs” took effect on Aug. 7
India: Continuing Disinflation Highlights RBI’s Renewed (Mild) Policy Error
- Headline CPI inflation eased to 1.55%YoY in Jul’25, implying that the real repo rate was +3.95%, the highest in 6.5 years (and versus +2.19% in Jan’25 before rate cutting began).
- The RBI is behind the curve, and will need to cut the repo rate another 75bp by Dec’25 in order to adhere to its 2-6% inflation target.
- Vegetable and food deflation will persist until Oct’25, thereby ensuring 2.8% average CPI inflation in FY26. Countering Trump tariffs with faster INR depreciation also argues for steady rate cuts.
Lee Jae-Myung to Meet Trump: Impact on North Korea Economic Reconciliation Stocks
- It was reported today that the new South Korean President Lee Jae-Myung will meet US President Trump on 25 August in Washington DC.
- In this insight, we discuss in particular how the meeting between Lee and Trump could lead to some outperformance of the North Korean economic reconciliation stocks.
- We provide a list of 10 South Korean companies that are beneficiaries of increased economic reconciliation with North Korea. These 10 stocks are up on average 109% YTD.
Actinver Research – Macro Daily: Industrial Activity (June 2025)
- In June, industrial activity registered a slight contraction of -0.1% MoM, breaking the growth streak of April and May.
- The manufacturing sector showed resilience, while construction remained stable.
- The observed figure came in below our estimate of 0.3% MoM and the 0.2% MoM expected by the consensus.
RBA Cuts as Productivity Concerns Grow
- The RBA cut rates by 25bp to 3.60%, as expected, in the third reduction of 2025, with unanimous board support following July’s surprise 6-3 hold pending inflation data.
- The central bank downgraded its productivity growth assumption to 0.7% from 1.0%, lowering medium-term GDP forecasts and signalling structural economic challenges ahead.
- The Governor signals that a “couple more” cuts are likely, with the cash rate path expected around 3.0% by 2026, while maintaining a data-dependent approach to future policy decisions.
This content is sourced through publicly available sources and has been machine generated. Information displayed is for general informational purposes only.
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