20th February 2025

MACRO:

• China's yuan strengthened against the dollar after U.S. President Donald Trump said a new trade deal with Beijing was possible. Trump said he expected Chinese President Xi Jinping to visit the United States without giving a timeline for his trip. Trump also told reporters that he was talking to China about TikTok. (RTRS)
• Trump said his administration is considering returning 20% of savings identified by Elon Musk's DOGE initiative to Americans, echoing a proposal made on social media site X. "There's even under consideration a new concept, where we give 20% of the DOGE savings to American citizens, and 20% goes to paying down debt," Trump said. (RTRS)
• Trump said he is going to work with Republicans in Congress to significantly reduce taxes for individuals and companies. Trump said his plan will also cut taxes on domestic producers of oil and gas, and allow companies to expense 100% of investments in new domestic factory construction and other capital expenses. (RTRS)
• Trump said he will announce fresh tariffs over the next month or sooner, adding lumber and forest products to previously announced plans to impose duties on imported cars, semiconductors and pharmaceuticals. (RTRS)
• Trump said his administration would quickly fill up the SPR, which he criticized his predecessor, former President Joe Biden, for tapping to bring down the price of gasoline. "We'll fill it up fast," Trump told a conference in Miami. (RTRS)
• Trump said his administration intends to ensure that the significant amount of US gold reserves held at Fort Knox is accounted for and accurate. (BBG)
• Trump signed a new slew of executive orders on Wednesday, including one aimed at preventing taxpayer dollars from supporting illegal immigration and one designed to get rid of regulations the administration considers "overreach." (RTRS)
• Federal Reserve Vice Chairman Jefferson said the Fed has time to weigh its next monetary policy move, citing a robust economy and still above target inflation. Jefferson said “bumpy” progress back to the target was likely following a percentage point’s worth of rate cuts last year. (RTRS)
• Thursday’s jobless claims report may be the first place to show the effects of the Trump administration’s sweep of the federal workforce. (BBG)
• Japan's 10-year government bond yield hit a fresh 15-year high on Thursday amid market speculations that the Bank of Japan (BOJ) may raise interest rates faster and higher. USDJPY is testing 150 to the downside for the first time since early December. (RTRS)
• Bloomberg survey shows more than 60% of Japanese companies — a record high percentage — plan to raise workers’ wages next year as they fight to recruit and retain staff. (BBG)
• Reuters poll shows the Bank of Japan will hike interest rates only once more this year, most likely during the third quarter to 0.75%, according to a majority of economists. (RTRS)
• Japan's Trade Minister Yoji Muto plans to visit the U.S. in March and will seek exemptions from Trump administration plans to set import tariffs on steel and cars. (Asahi)
• Almost nine out of 10 Japanese companies expect Trump's policies to negatively affect business, a Reuters survey showed. More than 40% of firms expect Japan's interest rate rise to 1% to undermine capital spending. (RTRS)
• Japanese equity markets saw a third straight week of foreign outflows in the week through February 15, influenced by shifts in U.S. tariff policies and a strengthening yen that dampened demand for export-dependent Japanese companies. (RTRS)
• Australia's unemployment rate ticked higher in January even though job creation handily outpaced forecasts, data showed on Thursday, a mixed outcome that does little to clarify the outlook for further cuts in interest rates. (RTRS)
• RBA Deputy Governor Hauser said the RBA reached a clear consensus on the decision to cut rates and Wednesday's data shows the jobs market is incredibly strong but added still need a bit more good news on inflation. Reiterated does not share market confidence about rate cut path.
• Economists say China could its cut its main policy rate as soon as next month following the country’s annual parliamentary meeting, after the country’s central bank chose to keep the loan prime rate steady on Thursday. (CNBC)
• China's Supreme People's Procuratorate and the CSRC will hold a press conference on February 21th to strengthen the crackdown on securities violations and promote the healthy development of the capital market. (Newswires)
• Morgan Stanley strategists shed their bearish view on Chinese stocks to turn more optimistic, following Wall Street peers. (BBG)
• China has been "doing its best" to push for negotiations with the EU, a commerce ministry spokesperson said on Thursday when asked about progress in negotiations on electric vehicles tariffs and trade between China and Europe. (RTRS)
• Confidence among UK households slipped to a new low under the Labour government, as consumers brace for higher prices and businesses warn of a hiring hit from rising payroll taxes, according to the BRC. (BBG)
• Switzerland aims to sign a deal with the EU to secure its access to the bloc’s single market early next year, with a possible plebiscite still looming. (BBG)
• Singapore’s Abaxx Exchange plans to introduce gold futures in the coming months, with prices setting fresh records this year as traders grapple with disruptions in key bullion hubs and increased haven demand. (BBG)

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GEOPOLITICAL:

• The Trump administration may seek to strike a simplified minerals deal with Ukraine to get a pact in place quickly and later negotiate detailed terms, such as how much of Ukraine's vast resources the U.S. would own, sources say. Trump wants a deal before potentially authorizing more military support for Kyiv or moving ahead with peace talks. (RTRS)
• Trump doubled down on his criticism of Ukrainian President Zelenskiy on Wednesday, telling a conference in Florida that the Ukrainian leader has done a terrible job and could have come to talks with Russia in Saudi Arabia if he had wanted to. (RTRS)
• French President Macron will defend Europe’s interests regarding Ukraine when he meets Trump in Washington next week, a French minister said. (BBG)
• The US is set to cut the size of its diplomatic mission in China by up to 10%, the SCMP reported on Wednesday, as part of Trump's plan to cut staffing across embassies. (SCMP)
• A senior U.S. military commander who oversees operations over much of Latin America will visit Panama this week to discuss security cooperation as well as the Panama Canal and migration, the U.S. embassy in the Central American nation said on Wednesday. (RTRS)

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EQUITIES:

• UBS have a bullish note out on Nvidia, suggesting strong revenue for its Blackwell chip and guidance due to a rapid ramp-up of production and improvements in supply chains. (Newswires)
• Nvidia’s latest RTX50 gaming graphics card series faces delays until mid-March at the earliest due to performance issues in the chips, RTX5070 and 5060, that needed to be debugged. (CTEE via @dnystedt)
• xAI says Grok 3 is now available for free, with X Premium+ and SuperGrok users receiving increased access. (X)
• X, led by CEO Linda Yaccarino, pressured advertising giant Interpublic to increase spending on the platform, hinting that failure to comply could affect the company’s merger with Omnicom, given Musk's power in the White House. (WSJ)
• Palantir extended its losses in after hours trade after CEO Karp ramped his share sales plan, coming on the back of the Pentagon's announced budget cuts. (Newswires)
• Apple Intelligence will support Simplified Chinese in early April. (Newswires)
• Trump said his administration may have to go a different route with the Air Force One planes, ratcheting up pressure on Boeing, which is at least three years behind schedule in delivering two new Air Force One jets. (RTRS)
• Starbucks CEO Brian Niccol, in a WSJ interview, plans to turn around the company by reviving the "coffeehouse vibe," addressing issues with mobile ordering, drive-through focus, and rewards program reliance, while making operational changes to improve customer experience. (WSJ)
• Airbus predicted a 7% rise in commercial deliveries to around 820 jets in 2025 and confirmed a delay to its A350 freighter model as it posted lower core annual operating earnings broadly in line with expectations on Thursday. (RTRS)
• Schneider Electric sparks up on 'stellar Q4' and 'impressive' 2025 outlook. (RTRS)
• Mercedes-Benz expects earnings to fall significantly this year and outlined plans to boost competitiveness that include a 10% cut to production costs over the next couple of years. Announced EUR 5bln share buyback over 24 months. (WSJ)
• SAP has raised its dividend to EUR 2.35/shr from 2.20/shr. (Newswires)
• Lloyds Banking Group took a further provision in the fourth quarter for the potential hit of a possible redress linked to its motor finance business, leading its pretax profit for the period to miss expectations. (WSJ)
• UK recruiter Hays' first-half operating profit more than halved on Thursday, as uncertainty across major European economies crimped hiring. (RTRS)
• Zurich Insurance is expecting losses of $200 million from the January California wildfires as the insurer reported a 5% gain in profit for 2024. (BBG)
• Andrea Orcel says Ukraine breakthrough could unlock sale of UniCredit’s Russia unit. (FT)
• Samsung Foundry has been delivering beyond expectations by securing a series of orders from Chinese ASIC customers with its recent 4nm process. DeepSeek has sparked a wave of inquiries from Chinese ASIC clients, who are now ramping investments. (Korean press via @Jukanlosreve)
• China's Vanke has appointed state-linked executives from Shenzhen Metro to stabilize operations, while also securing a ¥2.8 billion ($380 million) loan, but still faces over ¥50 billion in debt due this year. (FT)
• China's DeepSeek denied reports of external fundraising, calling it a rumour. That followed suggestiong a group of investors including Alibaba were in for a stake in the name. (Newswires)
• Lenovo Group reported better-than-expected quarterly earnings, with solid revenue growth across segments, boosted by its bet on the fast-growing use of artificial intelligence. (WSJ)
• Rio Tinto, the biggest shipper of foreign aluminum into the U.S., said it has contingency plans ready if Trump imposes a 25% tariff on imports of the metal, with Europe a potential destination. (WSJ)
• Anglo American took another writedown on its struggling De Beers diamond unit, and posted a slide in profit, as the miner moves ahead with a radical overhaul of its business. (BBG)
• Australia’s largest pure-play lithium producer Pilbara Minerals said it sees demand recovering on the restart of a large mine and refinery in China, even as it reported a net loss in its half-year earnings. (BBG)