Market Summary (Jul 8, 2025)

We remain focused on escalating U.S. tariff threats that will soon hit as many as 100 nations, with Japan and South Korea already facing a 25% levy starting August 1 and others between 30–40%. The extension of the negotiation window to August 1 provides little comfort after 90 days of deadlock, keeping policy uncertainty elevated. In this environment, safe-haven assets have the upper hand: gold demand is being buoyed not only by renewed tariff jitters but also by central banks like China’s PBOC adding to reserves for an eighth consecutive month (see below). Meanwhile, the U.S. dollar is under pressure, particularly USD/JPY, which looks vulnerable ahead of further trade-policy shocks. The surprise RBA rate cut has injected additional volatility into AUD crosses, and sterling remains exposed amid ongoing fiscal concerns, underpinning upside in EUR/GBP.