Category: 3. Business

(Bloomberg) — Asian shares fluctuated with investors staying on the sidelines in the leadup to US jobs report, awaiting fresh data after recent prints signaled President Donald Trump’s trade war was hurting the US economy.

The MSCI Asia Pacific Index swung between gains and losses after Trump’s announcement of a trade deal with Vietnam had helped the S&P 500 close at another record high Wednesday. The dollar was steady Thursday, hovering around three-year lows. Equity-index futures for the US and Europe were flat. Gold dipped for the first time in four days.

Treasuries inched up Thursday. Yields rose in the prior session following heavy selling in the UK, where concerns about Chancellor of the Exchequer Rachel Reeves’ future reignited questions over the nation’s fiscal position. In Japan, 10-year bonds declined ahead of a closely watched auction of 30-year sovereign notes at 12:35 p.m. in Tokyo.

The cross-asset moves underscored cautious optimism as traders contend with pockets of uncertainty ahead of jobs data that will help identify the path ahead for interest rates. With stocks at a record high even after Trump ratcheted up trade tensions, investors are closely monitoring economic data before adding to their portfolios.

“Investors are generally adopting a cautious, wait-and-see approach before the jobs report to be announced later today,” said Tomo Kinoshita, global market strategist at Invesco Asset Management in Tokyo. A growing number of US indicators are pointing to a potential economic slowdown, he said.

On the Vietnam trade deal, Trump said that the Asian country had agreed to drop all levies on US imports. A 20% tariff will be placed on Vietnamese exports to the US, with a 40% levy on any goods deemed to be transshipped through the country. The deal risks provoking retaliatory steps from China, according to Bloomberg Economics.

News of the trade deal boosted Nike Inc. and some exporter stocks amid hopes the accord will avert a potential supply-chain catastrophe.  The country set its daily reference rate for the dong at a record low Thursday.

“Investors have become desensitized by Trump’s frequent erratic direction changes,” said Vey-Sern Ling, a managing director at Union Bancaire Privee. “So far most of these ‘deals’ don’t amount to much and the eventual implementation remains uncertain.”

Meanwhile, UK Prime Minister Keir Starmer said Reeves will stay on as Chancellor of the Exchequer, as he sought to draw a line under speculation about her future that sparked the bond selloff. 

Members of Starmer’s ruling Labour Party forced the government to scrap £5 billion ($6.8 billion) worth of cuts to welfare spending on Tuesday evening — making it even harder for Reeves to tame the government’s budget deficit. 

The pound was little changed against the dollar in Asian trading.

Like in the UK, investors have raised concerns in the US, where Trump’s signature economic legislation stalled in the House Wednesday afternoon as Republican fiscal conservatives delayed a key procedural vote. Trump later said on social media the House is ready to vote tonight on the tax bill.

In Japan, the auction of 30-year sovereign notes Thursday is shaping up as a barometer of policymakers’ success in quelling debt-market turmoil that pushed yields on the nation’s super-long bonds to record highs in May. While yields have stepped down from their peaks, markets remain wary, especially after the moves in the UK and the US overnight.

Back in the US, monthly nonfarm payroll data due later Thursday — a day earlier than usual due to a holiday —  will show slower hiring and the highest unemployment rate since 2021 as the Trump administration’s trade and immigration policy shifts start to leave an imprint.

Separate private payrolls data from ADP Research on Wednesday showed employment at US companies fell for the first time in over two years. Despite signs of a downshift, Federal Reserve Chair Jerome Powell has repeated the labor market remains solid. 

Following ADP Research’s private payrolls data, traders added to wagers on at least two rate reductions this year, with the first coming in September. If the upcoming jobs report shows further weakness, traders reckon the Fed could move up cuts.

Some of the main moves in markets:

Stocks

• S&P 500 futures were little changed as of 11:37 a.m. Tokyo time
• Japan’s Topix fell 0.3%
• Australia’s S&P/ASX 200 fell 0.6%
• Hong Kong’s Hang Seng fell 1.1%
• The Shanghai Composite fell 0.1%
• Euro Stoxx 50 futures were little changed

Currencies

• The Bloomberg Dollar Spot Index was little changed
• The euro was little changed at $1.1800
• The Japanese yen was little changed at 143.67 per dollar
• The offshore yuan was little changed at 7.1603 per dollar

Cryptocurrencies

• Bitcoin fell 0.5% to $108,659.08
• Ether fell 1.2% to $2,560.03

Bonds

• The yield on 10-year Treasuries declined two basis points to 4.26%
• Japan’s 10-year yield advanced 1.5 basis points to 1.440%
• Australia’s 10-year yield advanced two basis points to 4.17%

Commodities

• West Texas Intermediate crude fell 0.9% to $66.86 a barrel
• Spot gold fell 0.3% to $3,348.52 an ounce

This story was produced with the assistance of Bloomberg Automation.

–With assistance from Winnie Hsu.

©2025 Bloomberg L.P.

The Quad Foreign Ministers meeting in Washington this week made one thing clear: the group wants to move from talk to action. That’s a big shift, and a necessary one. But if you look closely at what’s going on behind the scenes, it’s obvious that turning ambition into results won’t be easy.

Let’s start with comments from US Secretary of State Marco Rubio. He talked about moving beyond “ideas and concepts” and turning the Quad into a “vehicle for action.” That’s not just political theatre. It’s a recognition that the Quad, made up of the United States, Australia, India, and Japan, needs to prove it can actually do things, not just meet and talk. In today’s world, where geopolitical tensions are rising and alliances are being tested, outcomes matter more than ever.

One of the clearest signs of this new focus is the push to secure critical minerals. This isn’t just about economics, it’s about power. China currently dominates the production and processing of rare earths and other key minerals like lithium, nickel, and copper. That gives Beijing serious leverage, especially in trade talks with the United States. So, when the Quad says it wants to diversify supply chains, it’s not just trying to hedge against market risks – it’s trying to shift the balance of strategic influence.

There are already some early moves. Japan is investing in Australian mines and refining facilities. Australia has offered the United States preferential access to a planned critical minerals stockpile. But here’s the catch: the US hasn’t taken up that offer yet. That hesitation says a lot about the complicated web of bilateral negotiations that sit underneath the Quad’s big-picture goals.

And that brings us to the real challenge: the Quad might look united on the surface, but dig a little deeper and you’ll find some serious friction between the United States and its partners.

If each country is pulling in a slightly different direction, because of domestic politics, economic concerns, or old grievances, it’s going to be hard to deliver on the promises made in Washington.

Take Australia. There’s still tension over the Trump administration’s trade tariffs and pressure on defence spending. Australia’s offer of minerals access seems to have been ignored so far, and there’s growing anxiety over the AUKUS defence pact, which is currently under review.

India’s in a similar boat. It’s also been hit by tariffs, and while its External Affairs Minister Subrahmanyam Jaishankar called the meeting “very productive,” he was quick to point out that no relationship is free of issues. India also pushed back on Trump’s claims about intervening in the India-Pakistan conflict – a reminder that trust isn’t automatic, even among allies.

Then there’s Japan. It’s facing the same tariff pressure and has been asked to ramp up defence spending. That’s already led to the postponement of a key ministerial meeting. Some analysts say the US-Japan relationship has lost momentum, bogged down by trade talks and public disagreements.

All of this matters because the Quad’s strength depends on its ability to act together. If each country is pulling in a slightly different direction, because of domestic politics, economic concerns, or old grievances, it’s going to be hard to deliver on the promises made in Washington.

That said, the Quad is clearly trying to broaden its scope. The group is now talking about economic development, tech, supply chains, and maritime security. They even brought in “30 or 40 companies” from member countries to explore private sector partnerships. That’s a smart move, governments can’t do this alone.

But let’s not forget the bigger picture. The world is still dealing with wars in Ukraine and the Middle East. China’s military rise and its claims on Taiwan are looming large. The Indo-Pacific is a strategic hotspot, and the Quad is trying to navigate it all while keeping its own house in order.

So yes, the Quad’s commitment to action is real. But the road ahead is messy. If the group can push through its internal tensions and deliver on things like critical minerals, it’ll prove that this alliance isn’t just a talking shop, it’s a force to be reckoned with. That’s a big “if.”

“Already last year, the delays in the European aviation network were the worst in 25 years, and the situation this year is likely to deteriorate further,” Transport Commissioner Apostolos Tzitzikostas wrote in a letter to transport ministers in April, seen by POLITICO.

“Last year, Europe saw 35,000 flights on a busy summer day, this year we expect to reach 38,000,” Tzitzikostas added.

“High demand puts considerable pressure on Air Navigation Service Providers (ANSPs), some of whom continue to struggle with staff and capacity shortages,” the commissioner acknowledged, calling on governments to start “hiring and training additional controllers where needed.”

Calling for more controllers

But the problem cannot be solved quickly because training new air traffic controllers takes at least three years. On top of that, professional certification to manage air traffic is limited to a specific area of Europe’s fragmented airspace, which is managed by 40 different ANSPs.

CAE, a Canadian company that specializes in training services, recently forecast that Europe will need the most air traffic controllers of any region over the next decade — 27,000 out of 71,000 globally.

Meanwhile, airlines are going ballistic.

U.S. tech giant IBM, a frontrunner in quantum tech, recently announced it expects to have the first workable quantum computer by 2029. That underlines the urgency of securing critical data.

“The fact that we have this roadmap now and that all of the EU member states agreed on this … I think this is really a big step,” said Stephan Ehlen, a cryptography expert at the German cybersecurity agency and one of the authors of the roadmap.

But making a plan is just the start.

“This is not only about these algorithms, it’s a huge migration problem … It affects billions and billions of systems,” said Bart Preneel, a cryptographer also from KU Leuven. “It’s a very complex problem that you cannot solve in a few A4s.”

It’s also a problem that hits home with national governments and their security and intelligence services. Several European governments have imposed export restrictions on quantum technology; the real concern for governments is whether their own communications are affected, and whether “everything they’re doing can be exposed,” Preneel said.

Some experts have downplayed a doomsday scenario for quantum, arguing that even if computers are developed that can break modern encryption, it still requires a significant amount of work and money to do so.

The EU has no excuse not to push on, said Manfred Lochter, another official at the German cyber agency. “If you don’t have access to quantum technologies, then you’re lost.”

ISLAMABAD:

The Oil Companies Advisory Council (OCAC) has cautioned the Special Investment Facilitation Council (SIFC) that the climate support and petroleum levies on furnace oil have become effective from July 1, 2025, which will raise its price by over 80%, making many industries, shipping services and independent power producers (IPPs) unviable.

In a letter sent to SIFC, OCAC Chairman Adil Khattak said that the advisory council and its member companies had expressed deep concern and protested over the imposition of petroleum levy of Rs82,077 per metric ton on furnace oil through the Finance Act 2025. “This levy, in addition to the Climate Support Levy of Rs2,665 per metric ton, poses a serious threat to the overall business environment,” he said.

“While we acknowledge and appreciate the support extended by the Special Investment Facilitation Council in securing an interim relief from the government – through the recovery of inadmissible general sales tax (GST) on petroleum products via the inland freight equalisation margin (IFEM), this remains a temporary measure with limited scope,” he said and demanded a sustainable solution by restoring the taxable status of currently exempt petroleum products, ie, motor spirit (petrol), high-speed diesel (HSD), kerosene oil and light diesel oil (LDO).

He called SIFC’s continued support pivotal until full and permanent resolution of the matter. Khattak stated that the abrupt imposition of levies on furnace oil without prior consultation with the industry reflects a complete disconnect from the economic and operational challenges being faced by the sector.

Furnace oil is a deregulated product and its pricing is governed by market forces. It is mainly used to meet energy needs of the domestic industry. “The imposition of such a substantial fiscal burden will have widespread and adverse financial repercussions across multiple business sectors, threatening their viability and long-term sustainability,” he remarked.

OCAC said that the new levies would increase furnace oil prices by approximately 80%, making its use economically unviable for key industries such as cement, shipping, textile, glass, tyre manufacturing, large-scale industrial units, foundries and other sectors reliant on boilers and furnaces (commonly referred to as general trade).

This drastic price increase would eliminate domestic furnace oil demand and cause a sharp decline in industrial activity, potentially resulting in partial or complete operational shutdowns, especially where no viable fuel alternatives exist, it warned.

In the letter, OCAC underscored that this measure was in direct contradiction to the government’s stated commitment to promoting domestic manufacturing. Rather than enhancing revenues, it is likely to significantly reduce or eliminate furnace oil sales within the country, thereby slashing associated sales tax revenues and undermining industrial competitiveness.

“It will also defeat the objective of collecting the envisaged revenue through the imposition of petroleum and climate support levies.”

In the absence of domestic demand, the advisory council said, local refineries would be forced to export furnace oil at a considerable financial loss. This will further strain the financial condition of Pakistan’s refining sector and compromise its sustainability.

It pointed out that the government had recently renegotiated tariffs with furnace oil-based IPPs but the new levies would substantially increase fuel costs, pushing those plants lower on the merit order and rendering them inactive.

“This will nullify the gains from recent renegotiations while still obligating the government to make capacity payments, effectively increasing the burden on national finances.”

In light of the above, OCAC urged SIFC to intervene and recommend the withdrawal of petroleum and climate support levies on furnace oil. It believes this will help restore policy consistency, support critical sectors of the economy and uphold the principles of fair and sustainable economic development.

“We remain committed to engaging in constructive dialogue and are available for an urgent meeting to further discuss this matter in the national interest,” the OCAC chairman added.

US President Donald Trump has called for the chair of the Federal Reserve to quit “immediately”, in an escalation of his attacks on Jerome Powell.

“‘Too Late’ should resign immediately!!!”, Trump said in a post on his Truth Social platform.

He also included a link to a news article about a US federal housing regulator calling for Mr Powell to be investigated over his testimony about renovations to the central bank’s Washington headquarters.

Trump nominated Mr Powell to be the Fed chair during his his first term. Since then, he has repeatedly criticised him for not cutting interest rates but it’s unclear whether the president has the authority to remove him from the post.

Despite the president’s continued criticism of Mr Powell, he said earlier this year that had “no intention of firing him”.

Trump wants the Federal Reserve to lower interest rates to help boost economic growth.

Mr Powell said on Tuesday that the Fed would have cut rates already had it not been for the impact of the Trump’s tariff policies.

When asked during a meeting of central bankers in Portugal whether US rates would have been cut this again this year if the administration had not announced its plan to sharply increase tariffs on countries around the world Mr Powell responded, “I think that’s right.”

The US Federal Reserve declined to comment about Trump’s remarks when contacted by the BBC.

Ahead of Trump’s return to the White House at the start of this year, Mr Powell said he would not step down if the president asked him to and that it is “not permitted under law” for the White House to force him out.

Board members of independent federal agencies like the Federal Reserve can only be forced out before their terms expire “for cause,” according to a landmark US Supreme Court ruling in 1935.

However, Trump has often challenged political norms, including firing some independent regulators, actions that have been contested in court.

On Wednesday, Federal Housing Finance Agency director Bill Pulte, who has previously strongly criticised Mr Powell, called for him to be investigated.

“I am asking Congress to investigate Chairman Jerome Powell, his political bias, and his deceptive Senate testimony, which is enough to be removed ‘for cause,'” he posted on X.

Last week, Mr Powell told the Senate that reports about soaring costs and expensive features at the Fed’s headquarters were “misleading and inaccurate in many, many respects.”