Tariffs, trade deals and Tokyo wobbles
In this week's Market Focus Weekly from The Business Times, host Emily Liu checks in with Radhika Rao, senior economist at DBS, to walk us through what's really driving the markets across Asia.
Why listen?
Because US tariffs may finally be hitting wallets We unpack whether sticky inflation is being stirred up by protectionism—and what knock-on effects we're seeing in Asia.
Because Indonesia's new trade deal deserves more than a headline Radhika breaks down who stands to gain, what the long-term impact could be, and why this matters for Asean investors.
Because Japan's bond market is on edge From yield curve volatility to currency pressure, we explore what's spooking investors—and how much elections might add to the uncertainty.
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And because a change at the US Fed could shake up everything What would a new Fed chair mean for interest rates, the dollar, and Asia's monetary outlook?
Market Focus Weekly is your essential catch-up on the signals shaping Asian markets. Listen now at bt.sg/podcasts. Got feedback or a hot topic in mind? Email us at btpodcasts@sph.com.sg.
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Written and hosted by: Emily Liu (emilyliu@sph.com.sg)
With Radhika Rao, executive director & senior economist, DBS Bank
Edited by: Chai Pei Chieh & Claressa Monteiro
Produced by: Emily & Chai Pei Chieh
A podcast by BT Podcasts, The Business Times, SPH Media
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Straits Times
21 minutes ago
- Straits Times
New research institute will grow S'pore's talent in nuclear energy, safety
Find out what's new on ST website and app. On July 11, a new Singapore Nuclear Research and Safety Institute was launched. SINGAPORE - With discussions on nuclear energy progressing around the world, Singapore is now building its expertise in this area with the launch of a new nuclear research and safety institute. On July 11, the Singapore Nuclear Research and Safety Institute (SNRSI) was launched with an expanded research scope, additional funding, and an aim to train up 100 nuclear experts by 2030 – up from the 50 today. The institute's predecessor was the Singapore Nuclear Research and Safety Initiative, which did not have its own building. There are at least two benefits of training Singapore's own pool of talent in this area. First, it could help Singapore better assess the suitability of deploying nuclear energy reactors here. Given different geographies, countries will have different access to energy resources. Some may be more endowed with renewable energy resources, such as wind or solar, compared to other nations, which may have to look to alternatives such as nuclear or geothermal energy. Even for countries considering nuclear energy, what works in one location may not work in another. Top stories Swipe. Select. Stay informed. Asia At least 19 killed as Bangladesh air force plane crashes into college campus Singapore Subsidies and grants for some 20,000 people miscalculated due to processing issue: MOH Singapore 2 workers stranded on gondola dangling outside Raffles City Tower rescued by SCDF Business Why Singapore and its businesses stand to lose with US tariffs on the region Singapore NTU introduces compulsory cadaver dissection classes for medical students from 2026 Singapore Fine, driving ban for bus driver who hit lorry, causing fractures to passenger and injuring 16 others Business $1.1 billion allocated to three fund managers to boost Singapore stock market: MAS Singapore Jail for man who conspired with another to bribe MOH agency employee with $18k Paris trip This is where it is essential to have talent with a keen understanding of local constraints and considerations, to be able to properly assess the risks and benefits of incorporating nuclear energy into the energy mix. Second, given that other countries in South-east Asia have indicated interest in tapping nuclear energy, local capabilities will put Singapore in a better position to understand the technology. This could improve national response to any radiological incidents in the region, should they occur. Five Asean countries – Vietnam, Indonesia, Philippines, Malaysia and Thailand – have said they are either studying the feasibility of advanced nuclear technology to meet their growing energy needs, or already have plans to build new reactors in the coming decades. Dr Michael Short, from the Massachusetts Institute of Technology's department of nuclear science and engineering, said the new institute will better help Singapore assess risks from regional nuclear facilities, and domestic ones as well if the Republic decides to deploy them. 'If Singapore doesn't build up nuclear expertise, it will be left both behind and at unknown risk of issues from Asean neighbours,' he said. But if the country were to build up its domestic capabilities in nuclear, it could boost its domestic risk assessments, and ensure greater safety for the region. Dr Victor Nian, founding co-chairman of independent think-tank Centre for Strategic Energy and Resources, said the launch of the institute is important for Singapore to 'accelerate its capacity building' in nuclear energy. SNRSI can help advance Singapore's collective knowledge in nuclear energy, he said. The institute can also help Singapore get plugged into international nuclear dialogues and collaborations, which could boost the Republic's engagement in nuclear research and public engagement. The launch of the institute is a significant step forward in the nation's approach to nuclear energy. In 2012, Singapore had initially considered atomic power unsuitable for the small island state. Dr Alvin Chew, senior fellow at the S. Rajaratnam School of International Studies at NTU, said Singapore had mooted the idea of nuclear energy deployment almost two decades ago to shore up its energy resilience. But the large conventional nuclear fission plants, which are the predominant types in operation currently, were not suitable for the densely populated country. Under regulations set by the UN atomic watchdog, the International Atomic Energy Agency, an emergency planning zone outside the facility is needed for the location of a nuclear power plant, he said. Since then, there have been multiple advancements from Singapore's original position. In particular, small modular reactors gained traction in the mid-2010s, said Dr Chew. These reactors are thought to be more suitable for land-scarce, population-dense Singapore as they have a lower power capacity, enhanced safety standards and require much smaller buffer zones, compared with conventional reactors. 'Therefore, Singapore is keeping the nuclear option open as SMRs will be deployed in the near future,' he said. In 2022, a report by the Energy Market Authority mentioned that emerging technology, including nuclear and geothermal, could potentially supply around 10 per cent of Singapore's energy needs by 2050. The EMA, which monitors emerging energy technologies, has also gone on learning trips to other countries such as the UK and Germany to learn from the best minds in nuclear energy. Singapore has also signed agreements with other countries to learn more about the nuclear technologies and scientific research. The new institute marks the next step in the country's journey: from a horizon scan of emerging nuclear technologies to investing in its own capabilities for research. Safety will continue to be a focus. This is key, since the impacts of a nuclear accident will be more consequential in densely populated areas like in Singapore, said Dr Chew. For example, the new five-storey building will have nuclear safety simulation labs where researchers create computer software to model virtual replicas of advanced reactors and run accident scenarios to assess their risks and what could happen during a meltdown. Studies are also done in radiobiology labs to assess the effects of chronic, low-dose radiation on the human body. Dr Dinita Setyawati, a senior energy analyst at energy think-tank Ember, said the nuclear safety research signals to the public that any potential deployment is grounded in scientific evidence and robust safety standards. This could go some ways in establishing long-term public trust. Experts have said that engagement with the public on the risks and benefits of nuclear energy is critical, as public perception could influence policy decisions. A good starting point to gauge public perception would be to carry out surveys to understand the public's level of awareness, as well as opinion, on the use of nuclear energy.
Business Times
an hour ago
- Business Times
As interest rates normalise, private credit can help portfolios
'HOW did you go bankrupt?' 'Two ways. Gradually, then suddenly.' – Ernest Hemingway, The Sun Also Rises Often quoted and widely recycled, that response from Mike Campbell – the fictional once-wealthy friend of Jake Barnes, narrator in Hemingway's novel – captures more than just personal financial woes. It's an apt description of how long-running trends unravel – first with subtle shifts, then with violent clarity. Economist Rudiger Dornbusch put it more clinically: 'In economics, things take longer to happen than you think they will, and then they happen faster than you thought they could.' Both sentiments apply to today's bond market. For nearly four decades, falling interest rates created a generational tailwind for fixed income. Bonds didn't just pay income, they delivered capital appreciation, diversification, and ballast. Now, that dynamic is breaking down. Prices have fallen, and correlations have flipped. The 40 per cent in a 60/40 portfolio – which comprises fixed income, the supposedly steady part – has become a problem. But there's one corner of the market that has held steady amid all this instability: private credit. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up From tailwind to headwind The bond bull market began in 1981, when then-Federal Reserve chair Paul Volcker engineered a brutal double-dip recession to break inflation's back. At the time, the 10-year Treasury yield peaked near 16 per cent. What followed was a 39-year stretch of disinflation, financial globalisation, and central bank credibility, which drove yields lower and bond prices higher. For fixed income investors, it was a golden era where being long duration paid off. A simple strategy of buying 10-year Treasuries and rolling them annually would have delivered over 8 per cent in annualised returns from 1981 to 2020. The Bloomberg Barclays Aggregate Bond Index returned a similarly impressive 8 per cent over that same period. Bonds weren't just a buffer against equity risk; they were a consistent source of performance. But that golden era followed a very different one. In the 35 years before 1981, yields climbed steadily and were far more volatile. Bondholders clipped coupons while watching principal values erode. Price appreciation simply wasn't part of the fixed income playbook. There were no 'total return' bond funds because, frankly, there was no total return to chase. The middle ground We're not heading back to the 1970s. The US economy is structurally stronger; the Fed is more disciplined; and the lessons of the Volcker era still hold. But we're also not in a new bond bull market. Instead, we're in a period of normalisation where rates are higher than the recent past but still lower than long-term historical norms. Following the global financial crisis (GFC), the Fed supported the bull market in bonds with quantitative easing. But in 2022, the central bank began reducing its balance sheet, and by continuing to let its Treasury holdings mature without reinvesting the proceeds, it has kept upward pressure on rates with the increased supply. Increased fiscal spending and higher deficits bring uncertainty and expectations of higher future Treasury issuance, increasing the term premium demanded by investors. This middle ground comes with consequences: greater volatility and interest rate risk, less price support, and less reliable diversification. We've written extensively about how rising rates scramble traditional asset class relationships. In 2022, when the Fed launched its most aggressive hiking cycle in decades, the longstanding negative correlation between stocks and bonds broke down. Since then, the two have moved in the same direction in 31 of the past 40 months, nearly 80 per cent of the time – a dynamic that undermines the very foundation of balanced portfolios. If you believe that we're beginning a normalised inflationary regime, different from the sub-2 per cent post-GFC era, the unreliable stock-bond correlation is likely to continue. Based on historical data, the stock-bond correlation becomes positive beginning at 2 per cent inflation, strengthening as inflation increases. It's not just the lack of diversification that's troubling. Bond market volatility, once rare, is becoming routine as a result of policy uncertainty. Modest data surprises or policy comments now trigger exaggerated moves across the yield curve, and central banks retreating as a steady source of demand has reduced market liquidity that helped keep bond prices stable and predictable. Once major buyers of Treasuries, central banks are pulling back as rising yields in markets such as Germany and Japan make US Treasuries less appealing, especially after factoring in currency hedging costs. At the same time, heightened uncertainty has caused the term premium to resurface, hitting an 11-year high in May. Investors are demanding more compensation for interest rate risk, reflecting a structurally different regime. In April, high-yield bond prices suffered their steepest drop since the early days of the pandemic – second only to March 2020. Private credit's quiet consistency While public credit markets have endured drawdowns and dislocations, private credit has functioned as intended, providing financing to borrowers and liquidity to private equity sponsors without disruption. That resilience is showing up in the data. April's tariff-driven volatility caused liquid credit spreads to swing sharply – widening in one of the most significant moves in history, before recovering around 71 per cent by early May. In contrast, the private credit market operated as usual, providing a stable source of funding for companies throughout the turmoil. Private credit's advantages are structural. In a world of higher rates and unpredictable correlations, it can offer insulation from policy shifts, with floating rates and lower correlation to public markets. The private credit model brings lenders (investors) directly to borrowers in a 'farm to table' model, reducing the role of bank intermediaries and giving back this spread to investors. The strategy's floating rate nature reduces exposure to interest rate risk, leaving credit risk as the primary concern – one that experienced managers seek to address through careful underwriting, active portfolio management, and within private investment-grade credit, a focus on first-lien senior secured debt. Historically, private credit has delivered steady cash flows, limited volatility, and a reliable alternative source of return. Importantly, the private credit space extends far beyond traditional direct lending. Today, the total addressable market for private credit exceeds US$30 trillion, a significant expansion from less than US$100 billion prior to the GFC. Private asset-backed financing has become a vital source of capital for companies in high-growth areas such as energy, digital infrastructure, and transportation, while providing investors with hard asset collateral, amortising cash flows and over-collateralisation. The continued growth of these sectors may expand the asset-backed financing opportunity and potentially give investors an increasingly diverse mix of private credit strategies, providing more resilient portfolios. That's good news for investors, because as they confront the 40 per cent problem – the end of easy returns and automatic diversification from public traditional fixed income – they'll need to adapt. In a portfolio that's no longer self-balancing, we believe that tools like private credit are essential. The writer is chief investment strategist, Blackstone Private Wealth Solutions
Straits Times
an hour ago
- Straits Times
Lionesses to regroup after challenging Asian Women's Cup qualifier
Find out what's new on ST website and app. Singapore's Kyra Elise Taylor (left) trying to take the ball off Lebanon's Mya Rose Mhanna in their Asian Women's Cup qualifier fixture on July 19, 2025. SINGAPORE – Four defeats in four games with13 goals conceded against two scored – the numbers sum up Singapore's tough campaign at the recent Asian Women's Cup qualifying tournament. In Amman, Jordan, the world No. 139 Lionesses finished bottom of Group A with zero points after losing to the hosts (0-5), Iran (0-4), Lebanon (0-1), and Bhutan (2-3). Humbled on the Asian stage, the results have revealed the areas of improvement for Singapore to close the gap with their regional counterparts. Head coach Karim Bencherifa said: 'The team showed tremendous effort and resilience throughout the qualifiers. While the scorelines didn't reflect the full picture, we had competitive moments, especially in the opening match against Bhutan and the final game against Lebanon. 'Despite the challenges, the players showed strong commitment and fought for every minute. These matches exposed areas we need to grow in, particularly physical conditioning and consistency, but also gave us important lessons to build on.' Originally scheduled from June 23 to July 5, the competition was delayed due to the escalating Iran-Israel conflict, forcing the Asian Football Confederation to relocate and reschedule the tournament. The games were subsequently held at the original venue at the King Abdullah II Stadium in Amman from July 7 to 19, after Iran and Israel agreed to a ceasefire. Top stories Swipe. Select. Stay informed. Singapore Subsidies and grants for some 20,000 people miscalculated due to processing issue: MOH Singapore 2 workers stranded on gondola dangling outside Raffles City Tower rescued by SCDF Business Why Singapore and its businesses stand to lose with US tariffs on the region Singapore Medallions with Singapore Botanic Gardens' iconic landmarks launched to mark milestone-filled year Life WP chairwoman Sylvia Lim to publish memoir with Epigram Books in 2027 Business $1.1 billion allocated to three fund managers to boost Singapore stock market: MAS Singapore Jail for man who conspired with another to bribe MOH agency employee with $18k Paris trip Singapore Jail, caning for man who held metal rod to cashier's neck in failed robbery attempt But the tournament began on a challenging note for Singapore against 171st-ranked Bhutan, as the Lionesses suffered multiple injuries. Four of their five substitutions were due to injury, leaving the team with only 10 players for about 17 minutes of the match, which Bencherifa said was physically and mentally exhausting. He added: 'The disruptions and injuries had a real impact... That naturally affected our rhythm and limited how we could rotate or manage players in the following matches. Still, the team kept their heads up and stayed committed. 'These challenges exposed the importance of squad depth and physical preparedness, especially in high level tournaments like this.' As the tournament progressed, Singapore came up against tough opposition, including world No. 68 Iran, who secured a spot in the 2026 Asian Cup in Australia as group winners, and 75th-ranked Jordan. They wrapped up their campaign with a 1-0 loss to world No. 130 Lebanon. Even though the results were not in their favour, captain Siti Rosnani Azman stressed that the team gave their best, while acknowledging that there is much room for improvement. The defender said: 'We tried not to dwell on it so much (on the tough matches and defeats) and pick ourselves up to go again. 'Of course, we do talk about it to clarify certain things but that doesn't stop us from giving our best for the next game.' Rosnani, who earned her 50th cap against Lebanon, said the team also had to adapt to other factors such as the weather, a different time zone and travel. She said: 'It shouldn't be an excuse, but I think as players we need to be able to take good care of ourselves. 'The medical team had been doing their best to keep everyone on top. After getting through the early phase, we managed to handle it well. The ability to adapt is very important and it should start with the player mindset.' Fitness is also a major concern, with Bencherifa noting that several goals were conceded in the final 25 minutes of the matches. Of the 13 goals Singapore let in, six were scored after the 65th minute. Bencherifa said: 'To move forward, we must find ways to better support players in committing to regular physical preparation, recovery, and strength work – not just for performance, but for injury prevention.' Raising the bar in fitness and conditioning is one area that will need to be addressed as Singapore look to catch up to their regional rivals, said the Moroccan. Gaining more exposure to high-level matches is also essential, he added, as well as creating an environment that allows players to train more consistently with support in nutrition and recovery. Consistency and continuity remain a challenge as they often travel without their full squad due to players' work commitments or other obligations, he noted. For instance, the postponement of the qualifiers left the team without key players such as forward Danelle Tan, who had to attend to mandatory administrative requirements for her transfer to Nippon TV Tokyo Verdy Beleza. Despite these challenges, the team are looking ahead to their next major competition – the SEA Games in December. Preparations for the biennial tournament in Thailand will begin after the Women's Premier League in August. Bencherifa shared that there are plans for a training camp and high-level international matches in the lead-up to the tournament. He added: 'The goal is to improve not only team cohesion and tactical readiness but also to prepare players holistically – physically, mentally, and emotionally – to compete at the SEA Games level.'
