CNA938 Rewind - Trump-Marcos high-stakes trade talks
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CNA
10 minutes ago
- CNA
Philippine central bank on track for two more rate cuts in 2025
MANILA :The Philippine central bank is committed to maintaining its easing bias and is on course to cut policy rates twice this year, its governor said on Monday, though the timing will depend on economic growth and inflation. "We're still on that same easing cycle," Governor Eli Remolona told Reuters. "We're doing baby steps. That's a good sign, that means we're on track." The Bangko Sentral ng Pilipinas (BSP) is closely monitoring economic indicators to guide its decisions, including whether to implement a rate cut at its upcoming August 28 policy meeting. He emphasised that weaker-than-expected growth and better-than-projected inflation would be key triggers for further easing. "If the data on growth is worse than we thought, and inflation is better, that would be a good time for another rate cut," Remolona said. "We have to look at the data twice, three times." In June, the central bank lowered its key rate by 25 basis points to 5.25 per cent, its lowest in two-and-a-half years, a second consecutive cut to support the economy. Annual inflation has stayed below 2 per cent since March, and the central bank expects the pace of price increases to remain at that level, including in July. Inflation was 1.4 per cent in June. The governor was optimistic growth in the second quarter would be better than the 5.4 per cent expansion in the first three months of the year. The Philippines' trade deal with the United States has reduced uncertainty, and that should bode well for growth, Remolona said. Last week, U.S. President Donald Trump announced new import duties of 19 per cent for goods from the Philippines, slightly below the rate of 20 per cent he threatened earlier this month. "Growth will not slow down as much as before, but there's still residual uncertainty," he said. Still, there are risks that could cloud the country's growth outlook, including tensions in the Middle East, especially surrounding oil prices and regional conflict, he said. In shaping its decisions, the BSP also considers global monetary policy conditions, including the U.S. Federal Reserve's outlook, though the governor said the Fed's influence on BSP's actions has waned in recent years. "It will carry some weight, not a lot of weight, not as much as before," he said, citing a more sophisticated market and the peso's relative strength even without closely matching the Fed's rate path. Remolona also flagged threats to central bank independence as a significant concern, warning of long-term implications. "Wherever the central bank loses its independence, regardless of fiscal policy, it leads to high inflation," he said, adding central banks view what is happening in the United States with "concern". Despite external uncertainties, Remolona highlighted the Philippines' solid domestic fundamentals, including ample reserves, stable remittances and slowing inflation.
CNA
an hour ago
- CNA
Dollar strengthens after US and EU agree to tariff deal
TOKYO/LONDON :The dollar rose against major peers on Monday after the United States and the EU struck a framework trade pact, the latest in a flurry of deals to avert a global trade war, with investors also looking to this week's U.S. and Japanese central bank meetings. Meeting in Scotland on Sunday, U.S. President Donald Trump and European Commission President Ursula von der Leyen said the deal provided for an import tariff of 15 per cent on EU goods, half the rate Trump had threatened from August 1. That follows last week's U.S. agreement with Japan, while top U.S. and Chinese economic officials will resume talks in Stockholm on Monday aiming to extend a truce by three months and keep sharply higher tariffs at bay. The euro was last at $1.1693, down 0.4 per cent on the day, reversing an initial knee-jerk rise in Asia trade as investors' focus shifted to what an easing in global trade tensions meant for the dollar overall. "The mood music on U.S. trade negotiations has been a little brighter following agreements with Japan and the EU," said Paul Mackel, global head of FX research at HSBC. "If more 'trade deals' are reached, this could help to reduce this source of policy uncertainty that has weighed against the dollar, at least for now. It could also see other factors such as relative yields becoming more influential." The dollar tumbled sharply earlier this year, particularly against the euro, as fears dramatically higher tariffs on trade with most of its major partners would hurt the U.S. economy caused investors to consider shifting out of U.S. assets. Normally the gap between yields on government bonds is a major factor for currency moves, but at present the euro is meaningfully higher than the gap between U.S. and euro zone yields would imply. The euro was also last down slightly on the yen and sterling, having hit a one-year high on the Japanese currency, and a two-year high on sterling at the start of trade. The dollar was stronger elsewhere, up 0.15 per cent on the yen at 147.83, while the pound was down 0.13 per cent at $1.3428. As concerns subside about the economic fallout from punishing tariffs, investor attention is shifting to corporate earnings and central bank meetings in the United States and Japan in the next few days. Both the Fed and the Bank of Japan are expected to hold rates steady at policy meetings this week, but traders will watch subsequent comments to gauge the timing of the next moves. Investors will also be watching to see Trump's reaction to the Fed's decision. The U.S. President has been putting the Fed under heavy pressure to make significant rate cuts, and Trump appeared close to trying to fire Powell last week, but backed off with a nod to the market disruption that would likely follow. In cryptocurrencies, ethereum jumped 1.7 per cent and reached as high as $3,940.25, the most since December 2024.
Business Times
2 hours ago
- Business Times
Thailand and Cambodia begin truce talks as fighting drags on
[KUALA LUMPUR] Thailand and Cambodia's leaders opened peace talks Monday (Jul 28) in Malaysia, seeking a ceasefire after five days of combat along their jungle-clad frontier that has killed at least 35 people. More than 200,000 people have fled as the two sides fired artillery, rockets and guns in a battle over the long-disputed area, which is home to a smattering of ancient temples. The flare-up is the deadliest since violence raged from 2008-2011 over the territory, which is claimed by both sides because of a vague demarcation made by Cambodia's French colonial administrators in 1907. Hours ahead of the talks, an AFP journalist in the Cambodian city of Samraong – 17 kilometres from the fraught frontier – reported hearing a steady drumbeat of up to 10 blasts a minute. US President Donald Trump – who both nations are courting for trade deals to avert the threat of eye-watering tariffs – intervened over the weekend, and said both sides had agreed to 'quickly work out' a truce. Thai acting Prime Minister Phumtham Wechayachai and Cambodia's Prime Minister Hun Manet began their talks in the administrative capital Putrajaya around 3.15pm. A NEWSLETTER FOR YOU Friday, 8.30 am Asean Business Business insights centering on South-east Asia's fast-growing economies. Sign Up Sign Up They met at the residence of Malaysian leader Anwar Ibrahim, serving chair of the Asean bloc of which Thailand and Cambodia are both members, who earlier told media he would focus on an 'immediate ceasefire'. Washington's top diplomat Marco Rubio said State Department officials were on the ground in Malaysia to assist the 'peace efforts' while Cambodia said a delegation from its close ally China would also attend. But ahead of the summit, Thailand and Cambodia traded fresh fire and barbed accusations. Cambodia's defence ministry spokeswoman Maly Socheata said it was 'the fifth day that Thailand has invaded Cambodia's territory with heavy weapons and with the deployment of a lot of troops'. As he departed Bangkok airport, Phumtham told reporters he did not believe Cambodia was 'acting in good faith' and called on the country 'to demonstrate genuine intent' in the meeting. In Thailand's Surin city – 30 kilometres from the border and a hub of evacuees fleeing the fighting – 58-year-old Lamduan Chuenjit shared her leader's scepticism. 'I hope the negotiation goes well today and ends with a ceasefire,' the cleaner told AFP while sweeping a shopfront. 'But I do wonder how trustworthy Cambodia is.' On the eve of the talks, Thailand's military said Cambodian snipers were camped in one of the contested temples, and accused Phnom Penh of surging troops along the border and hammering Thai territory with rockets. It said there was fighting at seven areas in the rural region, marked by a ridge of hills surrounded by wild jungle and fields where locals farm rubber and rice. 'The situation remains highly tense, and it is anticipated that Cambodia may be preparing for a major military operation prior to entering negotiations,' the Thai military statement read. Thai King Maha Vajiralongkorn marked his 73rd birthday on Monday, but a notice in the country's Royal Gazette said his public celebrations scheduled for Bangkok's Grand Palace have been cancelled amid the strife. Trump has threatened both countries with high levies in his global tariff blitz unless they agree to independent trade deals – but said he would 'look forward' to signing them once 'peace is at hand'. Each side has already agreed to a truce in principle, while accusing the other of undermining peace efforts and trading allegations about the use of cluster bombs and targeting of hospitals. Thailand says eight of its soldiers and 14 civilians have been killed, while Cambodia has confirmed eight civilian and five military deaths. The Thai military said it had returned the bodies of 12 Cambodian soldiers killed in combat. More than 138,000 people have fled Thailand's border regions, while around 80,000 have been driven from their homes in Cambodia. With the skirmish inflaming nationalist sentiments, Thailand warned its citizens to 'refrain from any kind of violence, whether in speech or action' against Cambodian migrants living in the country. AFP
