Crude oil steadies
Brent crude futures fell 24 cents, or 0.3%, to settle at $69.28 a barrel, while US West Texas Intermediate (WTI) crude futures fell 20 cents, or 0.3%, to end at $67.34. That put both crude benchmarks down about 2% for the week.
In the United States, single-family homebuilding dropped to an 11-month low in June as high mortgage rates and economic uncertainty hampered home purchases, suggesting residential investment contracted again in the second quarter.
In another report, however, US consumer sentiment improved in July, while inflation expectations continued to decline. Lower inflation should make it easier for the US Federal Reserve to reduce interest rates, which could cut consumers' borrowing costs and boost economic growth and oil demand. Separately, US President Donald Trump is pushing for a minimum tariff of 15% to 20% in any deal with the European Union, the Financial Times reported on Friday, adding that the administration is now looking at a reciprocal tariff rate that exceeds 10%, even if a deal is reached.
'Currently envisioned reciprocal tariffs, coupled with announced sectoral levies, could push the US effective tariff rate above 25%, surpassing 1930s peaks.
In coming months, the tariffs should increasingly be manifest in inflation,' analysts at US bank Citigroup's Citi Research said in a note. Rising inflation can raise prices for consumers and weaken economic growth and oil demand.
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Express Tribune
5 minutes ago
- Express Tribune
US, China to resume tariff talks in effort to extend truce
US and Chinese flags and a "tariffs" label are seen in this illustration created on April 10, 2025. Photo: Reuters Listen to article Senior US and Chinese negotiators meet in Stockholm on Monday to tackle longstanding economic disputes at the centre of the countries' trade war, aiming to extend a truce keeping sharply higher tariffs at bay. China is facing an August 12 deadline to reach a durable tariff agreement with President Donald Trump's administration, after Beijing and Washington reached a preliminary deal in June to end weeks of escalating tit-for-tat tariffs. Without an agreement, global supply chains could face renewed turmoil from duties exceeding 100%. The Stockholm talks, led by US Treasury Secretary Scott Bessent and Chinese Vice Premier He Lifeng, take place a day after European Commission President Ursula von der Leyen meets Trump at his golf course in Scotland to try to clinch a deal that would likely see a 15% baseline tariff on most EU goods. Also Read: Israel announces daily pauses in Gaza fighting as aid airdrops begin Trade analysts on both sides of the Pacific say the discussions in the Swedish capital are unlikely to produce any breakthroughs but could prevent further escalation and help create conditions for Trump and Chinese President Xi Jinping to meet later this year. Previous US-China trade talks in Geneva and London in May and June focused on bringing US and Chinese retaliatory tariffs down from triple-digit levels and restoring the flow of rare earth minerals halted by China and Nvidia (NVDA.O), opens new tab H20 AI chips and other goods halted by the United States. So far, the talks have not delved into broader economic issues. They include US complaints that China's state-led, export-driven model is flooding world markets with cheap goods, and Beijing's complaints that US national security export controls on tech goods seek to stunt Chinese growth. "Stockholm will be the first meaningful round of US-China trade talks," said Bo Zhengyuan, Shanghai-based partner at China consultancy firm Plenum. Trump has been successful in pressuring some other trading partners, including Japan, Vietnam and the Philippines, into deals accepting higher US tariffs of 15% to 20%. He said there was a 50-50 chance that the US and the 27-member European Union could also reach a framework trade pact, adding that Brussels wanted to "make a deal very badly". Read: Six killed, scores injured in Indian temple stampede Two of Trump's top trade officials, Commerce Secretary Howard Lutnick and US Trade Representative Jamieson Greer, will attend the Scotland talks and then travel to Stockholm. Analysts say the US-China negotiations are far more complex and will require more time. China's grip on the global market for rare earth minerals and magnets, used in everything from military hardware to car windshield wiper motors, has proved to be an effective leverage point on US industries. Trump-Xi meeting? In the background of the talks is speculation about a possible meeting between Trump and Xi in late October. Trump has said he will decide soon whether to visit China in a landmark trip to address trade and security tensions. A new flare-up of tariffs and export controls would likely derail any plans for a meeting with Xi. "The Stockholm meeting is an opportunity to start laying the groundwork for a Trump visit to China," said Wendy Cutler, vice president at the Asia Society Policy Institute. Bessent has already said he wants to work out an extension of the August 12 deadline to prevent tariffs snapping back to 145% on the US side and 125% on the Chinese side. Still, China will likely request a reduction of multi-layered US tariffs totaling 55% on most goods and further easing of US high-tech export controls, analysts said. Beijing has argued that such purchases would help reduce the US trade deficit with China, which reached $295.5 billion in 2024. Also Read: Drone debris disrupts trains, suspends flights in Volgograd China is currently facing a 20% tariff related to the US fentanyl crisis, a 10% reciprocal tariff, and 25% duties on most industrial goods imposed during Trump's first term. Bessent has also said he would discuss with He the need for China to rebalance its economy away from exports toward domestic consumer demand. The shift would require China to put an end to a protracted property crisis and boost social safety nets to encourage household spending. Michael Froman, a former US trade representative during Barack Obama's administration, said such a shift has been a goal of US policymakers for two decades. "Can we effectively use tariffs to get China to fundamentally change their economic strategy? That remains to be seen," said Froman, now president of the Council on Foreign Relations think-tank.
Business Recorder
11 hours ago
- Business Recorder
Trump, EU's von der Leyen to meet on Sunday to clinch trade deal, avert trade war
BRUSSELS/EDINBURGH: European Commission President Ursula von der Leyen is set to meet US President Donald Trump on Sunday to clinch a trade deal for Europe that would likely see a 15% baseline tariff on most EU goods, but end months of uncertainty for EU companies. Trump, in Scotland for a few days of golfing and bilateral meetings, told reporters upon his arrival on Friday evening that von der Leyen was a highly respected leader and he was looking forward to meeting with her on his golf course in Turnberry. He said there was a 50-50 chance that the U.S. and the 27-member European Union could reach a framework trade pact, adding that Brussels wanted to 'make a deal very badly.' The EU faces U.S. tariffs on more than 70% of its exports, with 50% on steel and aluminium, 25% on cars and car parts and a 10% levy on most other EU goods. Trump has said he would hike the rate to 30% on August 1, a level EU officials said would wipe out whole chunks of transatlantic commerce. Further tariffs on copper and pharmaceuticals are looming. A 15% tariff on most EU goods would be seen by many in Europe as a poor outcome compared to the initial European ambition of a zero-for-zero tariff deal on all industrial goods. But it would be better than 30% and it would remove uncertainty about business conditions that has already hit profits of European companies. For Trump a deal with the EU would be the biggest trade agreement, surpassing the $550 billion accord reached with Japan earlier this week. Trump, who is seeking to reorder the global economy and reduce decades-old U.S. trade deficits, has so far reeled in agreements with Britain, Japan, Indonesia and Vietnam, although his administration has failed to deliver on a promise of '90 deals in 90 days.' The EU deal would be a huge prize, given that the US and EU are each other's largest trading partners by far and account for a third of global trade. While close, a deal still requires some final negotiations. US Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick departed Washington for Scotland on Saturday for talks with EU Trade Commissioner Maros Sefcovic, who is also travelling to Scotland, before the Trump-von der Leyen meeting. 'We're cautiously optimistic that there will be a deal reached,' said a Trump administration official, who spoke on he condition of anonymity. 'But it's not over till it's over.' In case there is no deal and the U.S. imposes 30% tariffs from August 1, the EU prepared countertariffs on 93 billion euros ($109 billion) of U.S. goods. EU diplomats have said a possible deal would likely include a broad 15% tariff on EU goods imported into the US, mirroring the US-Japan deal, along with a 50% tariff on European steel and aluminium. Trump told reporters there was 'not a lot' of wiggle room on the 50% tariffs that the U.S. has on steel and aluminium imports, adding, 'because if I do it for one, I have to do it for all.' It remains unclear if Washington would exempt EU imports from other sectoral tariffs on automobiles, pharmaceuticals and other goods that have already been announced or are pending although EU officials are hopeful the 15% baseline tariff would apply also to cars and pharmaceuticals.
Express Tribune
14 hours ago
- Express Tribune
Investors eye US-Europe deal before deadline
Listen to article Investors are hopeful a potential trade deal between the US and European Union could bring more certainty to markets ahead of next Friday's tariffs deadline. European Commission President Ursula von der Leyen was set to meet US President Donald Trump on Sunday in Scotland after EU officials and diplomats said they expected to reach a framework deal this weekend. Trump on Friday said there was a 50-50 chance or perhaps less that the US would reach a trade agreement with the EU. Trade tensions between the US and Europe may have provided some investors with a rationale to be cautious, said Sameer Samana, Head of Global Equities and Real Assets at Wells Fargo Investment Institute. "It's one of our largest trading relationships... So if that last piece falls into place, then you've probably got at the margin more people that have to get back in the markets," Samana said. "It's been a source of uncertainty that will go away." A deal would likely include a 15% baseline tariff on all EU goods entering the US and probably a 50% tariff on European steel and aluminum, the officials and diplomats said. Optimism over easing trade tensions broadly has helped push US stocks to record highs. Trump's April 2 "Liberation Day" announcement of sweeping global tariffs sent stocks plunging in the immediate aftermath, due to spiking fears about a recession that have since faded. Still, investors have been bracing for increased volatility heading into August 1, which the US has set as a deadline for raising levies on a broad swath of trading partners. The EU is facing US tariffs on more than 70% of its exports – 50% on steel and aluminum, 25% on cars and car parts and a 10% levy on most other EU goods, which Trump has said he would hike to 30% on August 1. Hopes for a deal with Europe rose after Trump struck a trade agreement with Japan earlier in the week. "The deal with Japan and the likely one soon with the EU are especially important given both are major US trading partners, together accounting for about a quarter of all goods' imports," analysts at Capital Economics said in a note on Friday. In the agreement with Japan, the country's auto sector, which accounts for more than a quarter of its US exports, will see existing tariffs cut to 15% from levies totaling 27.5% previously. An agreement that also lowers EU auto tariffs to 15% "would be no small deal" for the region as well, as about 10% of its shipments to the US are in the same category, Capital Economics said. Investors over the weekend were also watching for developments on trade between the US and China. Officials from the two countries plan to meet in Stockholm next week to discuss extending an August 12 deadline for negotiating a deal. Seoul seeks mutually agreeable package Meanwhile, South Korea will prepare a trade package that is mutually agreeable with the US ahead of minister-level meetings planned for next week and a US tariff-pause deadline of August 1, the presidential office said on Saturday. The package will include shipbuilding cooperation, a sector of high interest to US Commerce Secretary Howard Lutnick, who discussed the matter with South Korea Industry Minister Kim Jung-kwan on Friday, it said in a statement. Friday's meeting was a follow-up to a meeting on Thursday, where Lutnick and Kim reaffirmed their commitment to reach a trade deal by August 1, after a joint meeting of finance ministers and top trade envoys that had been scheduled for Friday was postponed. South Korea, facing 25% tariffs, is rushing to reach a trade deal with Washington, with National Security Adviser Wi Sung-lac visiting the US recently for high-level talks and Minister for Trade Yeo Han-koo also in the US for negotiations, as pressure grows on officials to clinch a deal that is no worse than Japan's that cut tariffs to 15%. South Korea's trade negotiations with the US have included non-tariff barriers in the agricultural and digital service sectors, but foreign exchange has not been part of trade talks beyond usual consultations, according to South Korean officials. South Korea Finance Minister Koo Yun-cheol and Foreign Minister Cho Hyun will also hold meetings with US Treasury Secretary Scott Bessent and State Secretary Marco Rubio, respectively, next week.
