Recommended Weekend Reads

China’s Space Station “Guard Dogs,”  How China Gets Around US Tariffs, Why Canada May Be the Best Hope for Mineral Security, and How Smuggled US Fuel Funds Mexican Cartels

June 13 - 15, 2025

Below are some of the more intriguing analyses and insights we read this past week. We hope you find them useful.  Please let us know if you or someone you know wants to be added to our distribution list. 

China

• China is arming its space station with ‘guard dogs.’ They have good reason for it   Fast Company

  China is developing robotic guards for its Tiangong space station. Equipped with small thrusters, these AI-powered robotic beasts are being developed to intercept and physically shove suspicious objects away from their orbital outpost. It’s a deceptively simple but ingenious step towards active space defense in an increasingly militarized domain. Rather than firing directed energy weapons like lasers or projectiles, which will turn the potential invader into a cloud of deadly shrapnel flying at 21 times the speed of sound, the Chinese have thought of a very Zen “reed that bends in the wind” kind of approach. The bots will grapple a threatening object and lightly push it out of harm’s way. Elegant space jiu-jitsu rather than brute kickboxing.
  

• Axis, Rivalry, or Chaos?  The US-China-Russia Equation with Michael McFaul    China Considered Podcast

  China expert Dr. Elizabeth Economy and Michael McFaul, the former US Ambassador to Russia and currently a Stanford Univeristy professor,  sit down to discuss the relationship between the United States, China, and Russia, the history of US engagement with Russia, his experience as the United States Ambassador to Russia under President Barack Obama, and the increasing cooperation between China and Russia. McFaul begins by discussing early engagement with Russian President Dmitry Medvedev during the early Obama years, namely the signing of comprehensive multilateral sanctions with Iran, along with his role in crafting the Obama administration’s Russia policy. The two scholars then shift to a conversation about how Russia and China, namely Vladimir Putin and Xi Jinping, are attempting to reshape the international order, how the war in Ukraine has already changed this relationship, and whether a “reverse Kissinger” is possible from the perspective of the United States.
  

• Will China Force a Rethink of Biological Warfare?    War on the Rocks

  Is the Defense Department still preparing to fight biological warfare as if it’s 1970? When preparing for biological warfare, most nations picture scenarios in which an enemy openly sprays traditional agents over wide areas to kill their adversaries.  However, revolutionary capabilities in the life sciences and biotechnology have transformed the threat. China’s approach to warfare, combined with these emerging technologies, reveals new vulnerabilities among Western forces that, to date, have not been fully acknowledged.   Although Western attention has focused on the rapid expansion of China’s nuclear and conventional warfighting capabilities, one ought to expect equal analysis of China’s biological warfare potential. By examining China’s most recent efforts at biological research, this report puts forward that it has bypassed 20th-century Western concepts of biological warfare and has new capabilities that could be effective across the entire conflict spectrum. New approaches and new concepts will be necessary if the United States is to prepare itself for potentially new forms of biological warfare in the 21st century.
  

• How China Gets Around US Tariffs     Robin Brooks Substack

  Brooks, a Senior Fellow at the Brookings Institution in Washington and former Chief Economist at the Institute of International Finance, as well as former Chief FX Strategist at Goldman Sachs, details how China has circumvented US tariffs by transshipping goods to the US through various third countries. The charts below show China’s exports (black) and imports (blue) to and from various countries in Asia: Indonesia (top left), Malaysia (top right), Thailand (bottom left), and Vietnam (bottom right). In all cases, China’s exports in April 2025 - the month in which US tariffs on China briefly went to 150 percent - reached new all-time highs, while imports remained subdued. Much as in the case of Kyrgyzstan or Kazakhstan, it’s not like domestic demand in these places started to boom with the escalation of the US-China trade war. The opposite is the case. This is - in all likelihood - evidence of big transshipments that are seeking to circumvent US tariffs.

 The Americas

• ·Canada May Be the United States’ Best Hope for Minerals Security   Center for Strategic and International Studies

  China’s recent export controls, especially of rare earth elements (REEs), have left Western companies reeling, with some firms allegedly considering shifting elements of production back to China just for access to the minerals. Indeed, the need for these minerals is so urgent that they took center stage in the recent U.S.-China negotiations in London, held in an effort to ease the trade war between the two countries. While the preliminary agreement to come out of these talks offers some respite, the United States needs to find reliable sources of REEs, and Canada could emerge as an alternative supplier to complement U.S. efforts to get domestic REE production back on its feet. However, this will require both countries to admit they still need each other, amidst the tension generated by President Donald Trump’ tariffs and talk of annexing Canada.

• The Hole in Mexico’s Security Strategy    Will Freeman/Foreign Affairs

  The defining dilemma of Claudia Sheinbaum’s presidency may be whether she is willing to alter the status quo with the cartels, raise the costs of collusion, and protect those who stand up to the cartels, instead. Since taking office in October 2024, Sheinbaum has taken a harder line on organized crime, increasing seizures of drugs and guns and arrests of suspected cartel operators. In February, when the Trump administration threatened tariffs on Mexico if it didn’t stop the flow of fentanyl across the border, Sheinbaum doubled down on her efforts, and the number of seizures and arrests has since grown substantially. But with their political and judicial protection networks still intact, any criminal groups that are weakened by the president’s current strategy may simply be replaced by new ones. Criminal-political networks will continue dividing the country into private fiefdoms, with politics, justice, and the legal economy reduced to arenas of lawless competition. Deadly drugs and insecurity will continue flowing north.

• How smuggled US fuel funds Mexico’s cartels    Financial Times

  In this interactive report by the Financial Times, reporters and researchers have uncovered dozens of suspicious shipments to Mexico, with millions of barrels of fuel falsely declared as industrial lubricant and unloaded by hose to trucks.  It reflects the massive and sophisticated smuggling operations funding Mexico’s cartels. As many as one in four vehicles in the country could be running on contraband fuel.

• Mexico’s Historic 2025 Judicial Elections: Winners, Controversies, and Political Implications    Moments in Mexico Substack

  On June 1, Mexicans went to the polls to vote in the country’s first-ever judicial elections.  881 federal positions were up for election and nearly 3,400 candidates ran.  Turnout was a record low – just 13% - but for President Claudia Sheinbaum’s ruling left-wing Morena Party, it secured significant control over the Supreme Court, further consolidating its political power. This excellent SubStack breaks down the elections and likely implications.

• Once the World’s ‘Most Popular Politician,’ Lula Is Losing His Way in Brazil    Bloomberg

  Six months after emergency brain surgery and in his second stint as president, the 79-year-old Brazilian remains as energetic and ambitious as ever on the world stage. He met Emmanuel Macron in Paris last week, will host the BRICS summit of emerging market countries in July, and is putting on the United Nations’ annual climate conference in the Amazon rainforest later this year.   But if that bravado once helped make him a global superstar — “the most popular politician on Earth,” Barack Obama called him in 2009 — it is now masking an ugly truth: Back home in Brazil, Lula is falling apart.  Polls show his popularity is at the lowest level of his presidency and suggest he will lose to a right-wing challenger.

The Growing Marketplace for Critical Minerals

• Building a New Market to Counter Chinese Mineral Market Manipulation   Center for Strategic and International Studies

  With China recently imposing export restrictions on rare earth elements—leading to U.S. automakers to halt production due to supply shortages—one of the most urgent issues is how to establish reliable Western supplies of essential critical minerals. A major challenge to achieving mineral security is China’s manipulation of global markets, whereby Chinese companies flood the market with excess supply, driving prices down to levels that force mining operations in countries like the United States and Australia to shut down. The United States and its allies cannot afford to act in isolation. Unilateral efforts—whether through tariffs, subsidies, or investment restrictions—will remain insufficient given the relatively small market share of individual countries. Instead, building a unified anchor market that aligns the policies of like-minded nations is the only realistic path to confronting China’s dominance. By harmonizing tariffs, establishing collective quotas, and coordinating investment protections, the anchor market can shift leverage away from Beijing and toward a more resilient, rules-based minerals ecosystem.

• Much More Than Minerals: The US-Ukraine Minerals Agreement and its Geopolitical Implications    CEPS

  After months of tense negotiations, the US and Ukraine signed a minerals agreement in Washington D.C. on 30 April 2025. While centered on natural resources, it’s much more than a business deal on mining natural resources. The Agreement enshrines US support for peace, resilience, sovereignty and reconstruction in Ukraine.  This CEPS Explainer breaks down the Agreement’s core provisions, its implications for all the parties involved and the necessary conditions needed for it to succeed.

• From Extraction to Innovation: The EU and Taiwan in the Critical Minerals Value Chain   ChinaObservers

  As the European Union’s green transition gains momentum, ensuring the safe and sustainable supply of critical raw materials (CRMs) has become a strategic priority. Renewable energy and decarbonization technologies – such as electric vehicles, wind turbines, solar panels, and batteries – depend on critical minerals including lithium, cobalt, nickel, and different rare earth elements (REEs). The EU’s agenda, as outlined in the European Green Deal and the accompanying industrial policy, cannot be achieved without robust, dependable, and diversified mineral value chains.

The Global Week Ahead

The G7 Leaders’ Summit Convenes, US and Chinese Trade Negotiations Begin Yet Again, Trump’s Birthday Parade, Pope Leo’s First Address to the US, and China’s Inflation Figures

June 8 - 15, 2025

The big geopolitical event of the week is the G7 Leaders’ Summit being held in Alberta, Canada.  This will be President Trump’s first trip to Canada since being re-elected and since he placed tough tariffs on the country.   

The overall G7 agenda, as outlined by Canadian Prime Minister Mark Carney, is to focus on several broad themes – “protecting our communities and the world, building energy security and accelerating digital transition, and securing the partnerships of the future.”  But the real focus will be trade and how to get to an end-game with the Trump tariff changes as well as discussing the opportunities and threats of AI. 

But a lot of other major action will be taking place at the Summit including a possible meeting between Ukrainian President Volodymyr Zelensky and President Trump – the first meeting between the two leaders since their disastrous meeting at the White House on February 28th. 

On Monday, US Secretary of Treasury Scott Bessent, Commerce Secretary Howard Lutnick, and US Trade Representative Jamison Greer will travel to London for talks with Chinese trade negotiators to try to and get trade talks back on track.   The meetings are the result of a telephone conversation between President Trump and Chinese President Xi Jinping this past week.  There had been a 90-day pause on Trump’s China tariffs but that quickly fell apart after the US added new guidance on preventing Chinese semiconductor chips to be sold in the US. 

Elsewhere this week, two big no-confidence votes are being held on Wednesday.  The first in Poland on the heels of last week’s presidential elections.  The Polish Parliament is likely to hold a no-confidence vote on Prime Minister Donald Tusks government and there is a fairly good chance it will go through, forcing new parliamentary elections.  

Meanwhile, Israel’s opposition parties will try to force a no-confidence vote in a bid to force new elections and push Prime Minister Benjamin Netanyahu from office.  Current polling suggest Netanyahu would lose if elections were held today as many voters appear unhappy with the ongoing Gaza war.  Additionally, two of Netanyahu’s coalition parties – both representing ultra-Orthodox voters – are threatening to withdraw their support unless there is a last-minute agreement giving an exemption to ultra-Orthodox men from military service.

Back in Washington, the US Senate will continue to work on the One Big Beautiful Bill Act (OBBA) – otherwise known as the Reconciliation bill – as a number of House Republican members who voted for the measure are now publicly expressing regret as the bill is now expected to add as much as $4 trillion to the federal deficit.   But the big news was Elon Musk’s extraordinary public spat with President Trump which began when Musk tweeted out his disgust with the size and shape of OBBA and then went on to criticize Trump – and even call for his impeachment – for supporting the bill in its current format.   We expect the US Senate to move to change a number of market-sensitive provisions – including Section 899 which would allow Treasury to place retaliatory taxes on foreign companies as well as the state and local (SALT) provisions which the House raised to $40,000 but is facing a host of criticism from Republicans.  We continue to hold the view reaching a final deal on OBBA is going to take much longer than the Trump Administration is hoping for – July 4th is the stated goal – and is likely to be scaled back in order to get enough Republican support. 

And finally, this week will see two big events in the US this Saturday: President Trump’s birthday parade on Friday in Washington that will simultaneously celebrate the 250th anniversary of the US Army.   The parade will take place along Constitution Avenue in Washington.   The second big event will be in Chicago where newly elected Pope Leo XIV will address via video to a sold-out (40,000+) Rate Stadium  (where the Holy Father’s beloved White Sox play).  This will be the Holy Father’s first official address to the United States. 

Looking at the global economic radar screen, the big events of the coming week are – aside from the G7 Meeting – China’s trade data and inflation figures and the US’s May CPI print.

The US CPI is out on Wednesday and PPI is out on Friday – both of which will be an important indicator for how the Federal Reserve may move during the FMOC meeting the following week and the overall impact of the Trump tariffs since Liberation Day.  Also out in the US this week is the Univeristy of Michigan June consumer sentiment survey on Friday.  There are no Fed speeches this week as the Fed has gone into their “Blackout Period” in advance of the FMOC meeting.

In Europe, UK Chancellor Rachel Reeves will be delivering the Spending Review to Parliament on Wednesday, revealing the spending priorities of  Prime Minister Starmer’s government.  It will include plans for spending more than £600 billion on public services – 1/5 of the total British economy.  In the EU this week, there are a large number of European Central Bank speeches including ECB President Christine Lagarde speaking in Beijing. 

Bringing it back to Asia, Japan releases the May Economy Watchers Survey on Monday and the PPI on Wednesday.   But markets are mostly focused on China’s inflation and trade figure releases on Monday to get a sense how deeply the Trump tariffs have impacted the economy. 

Below are all the other major geopolitical and geoeconomic events we are tracking this coming week:

Sunday, June 8, 2025

Global

·       Today is Pentecost, a major feast in the Christian church marking the 50th day of Easter.

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Asia

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Europe

Political/Social Events –

·       Italy is set to hold a Constitutional referendum and run-off elections for regional elective office through Monday.  The Constitutional referendum concerns changes to the law on the acquisition of Italian citizenship for foreign residents and repeals some provisions on employment as passed by the 2025 Jobs Act law.

·       EU President Ursula von der Leyen participates in the 2025 UN Ocean Conference Leaders dinner in Paris, France.  She will speak at the conference tomorrow.

Economic Reports/Events –

·       European Central Bank Board Member Pedro Machado participates in a panel discussion at the 31st Dubrovnik Economic Conference of Hrvatska Narodna Banka in Dubrovnik, Croatia.

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Israel Business Confidence (May)/ Tourist Arrivals (May)

·       Jordan Unemployment Rate Q1

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Monday, June 9, 2025

Global

·       The 2025 UN Ocean Conference begins in Nice, France and runs through June 13.  This is the first UN Ocean Conference since the 2022 conference in Lisbon (Portugal). It will also be the first conference since the historic Agreement on Biodiversity Beyond National Jurisdiction, also known as the High Seas Treaty.

·       The International Atomic Energy Agency (IAEA) Board of Governors meet in Vienna, Austria through June 13.

Americas

Political/Social Events –

·       US Secretary of the Treasury Scott Bessent, Commerce Secretary Howard Lutnick, and US Trade Representative Jamison Greer will travel to London for renewed trade talks with China. Chinese Vice Premier He Lifeng will lead the Chinese delegation.

·       The Trump Administration’s response to a Federal Appeals Court regarding tariff authority is due to be filed.

·       President Trump’s travel ban on 12 countries goes into effect.  The countries include Afghanistan, Myanmar, Chad, the Republic of the Congo, Equatorial Guinea, Eritrea, Haiti, Iran, Libya, Somalia, Sudan, and Yemen.

·       Former Brazilian President Jair Bolsonaro will testify before the Federal Supreme Court in a case in which he is accused of plotting a coup in 2022. 

Economic Reports/Events –

·       The US Federal Reserve goes into its “Blackout” period in advance of the Open Market Committee meetings June 17-18. There are no speeches by any Fed Governors until after the meetings.

·       Mexico Balance of Trade (April)

·       Chile Imports/ Exports/ Balance of Trade (April)

·       USA Balance of Trade (April)/ Balance of Trade (April)

·       Argentina Balance of Trade (April)

·       Colombia Balance of Trade (April)

·       Brazil BCB Focus Market Readout

Asia

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Australia celebrates the King’s Birthday.  Financial markets are closed.

·       New Zealand Manufacturing Sales Q1

·       Japan Current Account (April)/ GDP Growth Annualized Q1/ Bank Lending (May)/ GDP Capital Expenditure Q1/ GDP Price Index Q1/ BoJ JGB Purchases/ Eco Watchers Survey Current (May)

·       China Inflation Rate (May)/ PPI (May)/ Imports/ Exports/ Balance of Trade (May)

·       Singapore Unemployment Rate Q1/ Balance of Trade (April)

·       Indonesia Foreign Exchange Reserves (May)

·       Taiwan Imports/ Exports/ Balance of Trade (May)

Europe

Political/Social Events –

·       British Prime Minister Keir Starmer will receive NATO Secretary General Mark Rutte in London.  Rutte He will also give a speech at Chatham House and visit Sheffield Forgemasters with the Secretary of State for Defence, John Healey.

·       Argentine President Javier Milei visits Spain for bilateral talks.  Milei then travels on to Israel for meetings.

·       Belarus Foreign Minister Maxim Ryzhenkov travels to Moscow for meetings with Russian Foreign Minister Sergei Lavrov.  They are expected to discuss preparations for the upcoming Eurasian Economic Forum on June 26027 in Minsk.

·       London Tech Week begin and runs through June 13. Nvidia CEO Jensen Huang is scheduled to speak.

Economic Reports/Events –

·       It is Whit Monday in Europe.  Financial markets in Germany, Norway, and Switzerland are closed.

· European Central Bank Board Member Frank Elderson gives a keynote speech on the rule of law at the Italian Court in Rome, Italy.

·       Slovakia Balance of Trade (April)

·       Euro Area Balance of Trade (April)

·       Ireland Balance of Trade (April)

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Saudi Arabia GDP Growth Rate Q1

·       Israel Manufacturing PMI (April)

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Tanzania Inflation Rate (May)

Tuesday, June 10, 2025

Global

·       The UN Security Council is scheduled to hold a briefing on the UN Assistance Mission for Iraq (UNAMI) followed by consultations. 

·       Today is the 90th anniversary of the founding of Alcoholics Anonymous.

Americas

Political/Social Events –

·       The US Senate Foreign Relations Committee holds confirmation hearings for Jacob Helberg for undersecretary of state for economic growth, energy, and the environment; Andrew Puzder for U.S. ambassador to the European Union; Paul Kapur for assistant secretary of state for South Asian affairs; and Benjamin Black for CEO of the U.S. International Development Finance Corporation.

·       New Jersey holds its gubernatorial primary elections.

Economic Reports/Events –

·       USA NFIB Business Optimism Index (May)/ Redbook (June/07)/ API Crude Oil Stock Change (June/06)

·       Brazil Inflation Rate (May)

·       El Salvador PPI (May)/ Inflation Rate (May)

Asia

Political/Social Events –

·       China will host the fourth China-Africa Economic and Trade Expo in Changsha through June 12.

·       Pakistan’s finance minister, Muhammad Aurangzeb, will deliver a budget to parliament against the backdrop of the country’s IMF loan program.

·       The Bloomberg Invest Conference begins in Hong Kong and goes through June 11.

Economic Reports/Events –

·       Australia Westpac Consumer Confidence Index/ NAB Business Confidence (May)

·       Japan Machine Tool Orders (May)

·       Indonesia Motorbike Sales (May)

Europe

Political/Social Events –

·       EU President Ursula von der Leyen meets with Subrahmanyam Jaishankar, Minister of External Affairs of India in Brussels.

·       The Europlace Conference is being held in Paris, France.

Economic Reports/Events –

·       European Central Bank Board Member Claudia Buch participates on a panel discussion at the Jacques Delors event "Matching savings and investments: The role of banks and capital markets in financing Europe’s future", in Berlin.

·       European Central Bank Board Member Sharon Donnery gives a presentation at the 2025 IIF European Chief Risk Officer Forum (virtual).

· European Central Bank Governing Council member Robert Holzmann speaks at the presentation of the Austrian National Bank’s report on financial stability.

·       Bank of England External Member of the Financial Policy Committee Randall Kroszner gives a speech at the ECB Conference on Financial Stability and Macroprudential Policy 2025 in Frankfurt, Germany.

·       Great Britain Unemployment Rate (April)/ Employment Change (April)/ HMRC Payrolls Change (May)/ Claimant Count Change (May)

·       Romania Balance of Trade (April)

·       Switzerland Consumer Confidence (May)

·       Euro Area ECB Survey of Monetary Analysts 

·       Italy Industrial Production (April)

·       Slovenia Industrial Production (April)

·       Greece Inflation Rate (May)

·       Belarus Inflation Rate (May)

·       Ukraine Inflation Rate (May)/ GDP Growth Rate Q1

·       Turkey Treasury Cash Balance (May)

·       Slovakia Industrial Production (April)

·       Hungary Budget Balance (May)

Middle East

Political/Social Events –

·       Israeli Prime Minister Benjamin Netanyahu will meet with Argentine President Javier Milei in Tel Aviv, Israel.

Economic Reports/Events –

·       Saudi Arabia Industrial Production (April)

·       Kuwait M2 Money Supply (April)/ Private Bank Lending (April)

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       South Africa Manufacturing Production (April)

·       Mozambique Inflation Rate (May)

·       Kenya Interest Rate Decision

Wednesday, June 11, 2025

Global

·       The UN  Security Council is scheduled to hold a debate on International Residual Mechanism for Criminal Tribunals (IRMCT).

Americas

Political/Social Events –

·       Mexican airline Aero México will likely see flight attendants go on strike for higher wages.

·       Bloomberg hosts its Global Credit Forum in Los Angeles, California.

Economic Reports/Events –

·       USA MBA Mortgage Market Index (June/06)/ MBA Purchase Index (June/06)/ Inflation Rate (May)/ CPI (May)/ EIA Crude Oil & Gasoline Stocks Change (June/06)/ Monthly Budget Statement (May)

·       Mexico Industrial Production (April)

·       Canada Building Permits (April)

·       Colombia Consumer Confidence (May)

·       Ecuador Balance of Trade (April)

Asia

Political/Social Events –

·       The Philippine Congress holds hearing to present Articles of Impeachment against Vice President Sara Duterte.  The lower house in February impeached Duterte, the daughter of former President Rodrigo Duterte, on accusations that included budget anomalies, amassing unusual wealth and an alleged threat to the lives of President Ferdinand Marcos Jr, the first lady, and the House Speaker.

·       Malaysia will host the ASEAN Plus Three and East Asia Summits.

Economic Reports/Events –

·       New Zealand Visitor Arrivals (April)

·       South Korea Unemployment Rate (May)

·       Japan PPI (May)

·       Malaysia Industrial Production (April)/ Unemployment Rate (April)

·       India M3 Money Supply (May/30)/ Passenger Vehicles Sales (May)

·       Indonesia Car Sales (May)

Europe

Political/Social Events –

·       Polish lawmakers hold vote of confidence called by Prime Minister Donald Tusk after the defeat of a political ally in the June 1 presidential ballot with the election of Karol Nawrocki.

·       UK Chancellor Rachel Reeves presents the Spending Review to Parliament.

·       The Ukraine Recovery Conference begins in Berlin and runs through June 12.

·       European Council on Foreign Relations chair Carl Bildt, Congressional Leadership Fund former president Dan Conston and Danish climate minister Dan Jørgensen are among the speakers at the two-day Brussels Forum 2025, which will focus on transatlantic political and economic issues

·       VivaTEch!, Europe’s largest startup and tech event, begins in Paris and runs through June 14.

Economic Reports/Events –

·       European Central Bank President Christine Lagarde gives a presentation at the People's Bank of China in Beijing, China.

·       European Central Bank Board Member Claudia Buch gives a keynote speech followed by fireside chat at the Goldman Sachs European Financials Conference 2025 in Berlin, Germany.

·       European Central Bank Chief Economist Philip R. Lane gives a keynote presentation at the 2025 Government Borrowers Forum in Dublin, Ireland.

·       European Central Bank Board Member Piero Cipollo gives a video message at the European Payments Council's General Assembly in Brussels, Belgium.

·       Bank of England Executive Director for Markets Victoria Saporta gives a speech at the Bank of Finland and SUERF Conference on Monetary Policy Implementation in Helsinki, Finland.

·       Bank of England Executive Director for Financial Stability, Strategy, and Risk Nathanaël Benjamin gives a speech at the Global Investment Management Summit  in London.

·       Hungary Inflation Rate (May)/ Monetary Policy Meeting Minutes

·       Slovakia Construction Output (April)

·       Russia Balance of Trade (April)/ Inflation Rate (May)

·       Turkey Auto Production (May)/ Auto Sales (May)

Middle East

Political/Social Events –

·       Israel’s opposition parties will seek to dissolve the Knesset in an effort to bring an early election.  Prime Minister Benjamin Netanyahu’s coalition are threatening to leave over policies forcing conscription of ultra-Orthodox young men into the army.

Economic Reports/Events –

·       Israel Consumer Confidence (May)

Africa

Political/Social Events –

·       South Africa's National Assembly is due to vote on the government's proposed fiscal framework, the first of three pieces of legislation to adopt the country's 2025 budget.

Economic Reports/Events –

·       Ghana GDP Growth Rate Q1

·       South Africa SACCI Business Confidence (April)/ SACCI Business Confidence (May)

Thursday, June 12, 2025 

Global

·       The UN Security Council is scheduled in the morning to hold a briefing on Yemen, followed by consultations.  In the afternoon, it is scheduled to hold consultations on the United Nations Disengagement Observer Force (UNDOF).

·       World Bank President Ajay Banga will speak at the Council on Foreign Relations in New York.

Americas

Political/Social Events –

·       US Secretary of Defense Pete Hegseth and Gen. Dan Caine, chairman of the Joint Chiefs of Staff, appear in front of the House Armed Services Committee for a hearing on the Defense Department’s 2026 budget request.

·       Today is Chaco Armistice Day in Paraguay.  The public holiday commemorates the end of the Chaco War between Paraguay and Bolivia in the 1930..

Economic Reports/Events –

·       Brazil Retail Sales (April)

·       USA Initial Jobless Claims (June/07)/ Continuing Jobless Claims (May/31)/ PPI (May)/ Business Confidence (June)/ 15- & 30-Year Mortgage Rate (June/12)/ WASDE Report/ Fed Balance Sheet (June/11)

·       Paraguay Consumer Confidence (May)

·       Uruguay Industrial Production (April)

·       Argentina Inflation Rate (May)

·       Peru Interest Rate Decision/ Balance of Trade (April)

Asia

Political/Social Events –

·       Taiwan is expected to hold is annual Wanan Civil Defense Drills in the Kinmen Islands.

·       In Hong Kong, the Hong Kong Auto Expo begins and runs through Sunday. The event, organized by the mainland's China Association of Automobile Manufacturers, aims to help at drive the global expansion of the Chinese automotive industry, which is currently gripped by a brutal price war between electric vehicle manufacturers.

Economic Reports/Events –

·       New Zealand Electronic Retail Card Spending (May)

·       Japan BSI Large Manufacturing Q2/ Foreign Bond Investment (June/07)/ Stock Investment by Foreigners (June)

·       Australia Consumer Inflation Expectations (June)/ RBA Jacobs Speech

·       Indonesia Consumer Confidence (May)

·       Hong Kong Industrial Production Q1

·       India Inflation Rate (May)

·       Thailand Consumer Confidence (May)

Europe

Political/Social Events –

·       The EU Justice and Home Affairs Council (Justice) meets in Luxembourg. Ministers will discuss a general approach on a directive to harmonize certain aspects of insolvency law across the EU, protection of adults, and the fight against impunity (dealing with Russia war crimes).

·       The International Energy Administration holds a two-day conference on global energy efficiency in Brussels.

·       Today is Russia Day in Russia.  The national holiday originally celebrated the fall of communism and the collapse of the Soviet Union.  But its meaning has now been shifted by President Putin to celebrating the country’s modernization.

Economic Reports/Events –

·       European Central Bank Board Member Luis de Guindos gives a  keynote speech at the Annual Joint Conference of the European Commission and the European Central Bank “European financial integration: Advancing the savings and investments union” in Brussels, Belgium.

·       European Central Bank Board Member Isabel Schnabel visits and speaks at the House of the Euro in Brussels, Belgium.  Later in the day, Schnabel will moderate a panel entitled “Funding the future: Strategies for supporting innovation and growth” at the Annual Joint Conference of the European Commission and the European Central Bank “European financial integration: Advancing the savings and investments union” in Brussels, Belgium.

·       European Central Bank Board Member Frank Elderson will give a keynote speech at the IMF-WB annual high-level Conference for Senior Supervisors in Washington, DC.

·       Great Britain RICS House Price Balance (May)/ GDP (April)/ Goods Trade Balance (April)/ Balance of Trade (April)/ Construction Output (April)/ Industrial Production (April)/ Manufacturing Production (April)/ NIESR Monthly GDP Tracker (May)

·       Romania Inflation Rate (May)

·       Turkey Industrial Production (April)/ Foreign Exchange Reserves (June/06)

·       Ireland Inflation Rate (May)

·       Serbia Inflation Rate (May)/ Interest Rate Decision

·       Germany Current Account (April)

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Israel M1 Money Supply (May)

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       South Africa Gold Production (April)/ Mining Production (April)

Friday, June 13, 2025

Global

·       Nothing significant to report.

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Canada Capacity Utilization Q1/ Manufacturing Sales (April)/ New Motor Vehicle Sales (April)/ Wholesale Sales (April)

·       USA Michigan Current Conditions Prel (June)/ Michigan 5 Year Inflation Expectation/ Baker Hughes Total Rigs Count (June)

·       Colombia Industrial Production (April)/ Retail Sales (April)

·       Paraguay Balance of Trade (May)

·       Uruguay GDP Growth Rate Q1

Asia

Political/Social Events –

·       In Tokyo, Japan, campaigning for Tokyo’s metropolitan assembly elections being held on June 22 begin.  The race is seen as a key political test for Prime Minister Ishida in advance of Japan’s upper house elections later this summer.

Economic Reports/Events –

·       New Zealand Business NZ PMI (May)

·       Philippines Foreign Direct Investment (March)

·       Indonesia Retail Sales (April)

·       Japan BoJ JGB Purchases/ Industrial Production (April)/ Capacity Utilization (April)/ Tertiary Industry Index (April)

·       Malaysia Retail Sales (April)

·       Thailand Foreign Exchange Reserves (May)

·       Sri Lanka GDP Growth Rate Q1

·       India Foreign Exchange Reserves (June)/ Imports/ Exports/ Balance of Trade (May)

·       China Vehicle Sales (May)

Europe

Political/Social Events –

·       The EU Justice and Home Affairs Council (Home Affairs) will meet in Luxembourg. Ministers will discuss IT infrastructure, the Schengen report, migration issues, and EU internal security.

·       The 2025 Paris Air Forum will be held.

Economic Reports/Events –

·       Germany Wholesale Prices (May)/ Inflation Rate (May)

·       Romania Industrial Production (April)/ Current Account (April)

·       Hungary Construction Output (April)/ Industrial Production (April)

·       France Inflation Rate (May)

·       Slovakia Inflation Rate (May)

·       Spain Inflation Rate (May)

·       Italy Balance of Trade (April)

·       Poland Inflation Rate (May)/ Balance of Trade (April)/ Current Account (April)

·       Euro Area Industrial Production (April)/ ECB Montagner Speech/ ECB Elderson Speech

·       Greece Construction Output Q1

·       Ukraine Balance of Trade (April)

·       Russia GDP Growth Rate Q1

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Jordan Inflation Rate (May)

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Angola Inflation Rate (May)/ Wholesale Prices (April)

Saturday, June 14, 2025

Global

·       Today is Eid-e-Chadir, celebrated by Shia Muslims on the 18th day of the Islamic month of Dhul Hijjah, the final month of the lunar based Muslim calendar.  The religious holiday is named after the event in which Shia Muslims believe that the cousin of the Prophet Muhammad, Ali ibn Abi Talib, was appointed as a leader and religious authority after the Prophet.

·       Pope Leo XIV will speak virtually at a youth event being held at White Sox Stadium in Chicago.

Americas

Political/Social Events –

·       Today is Falkland Islands Liberation Day, celebrating when in 1982 the Island was liberated from Argentinian occupation.

·       Today is President Donald Trump’s 79th birthday.  The day will be celebrated with a large military parade which will also celebrate the US Army’s 250 anniversary.

Economic Reports/Events –

·       Nothing significant to report.

Asia

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Europe

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Israel Inflation Rate (May)

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Sunday, June 15, 2025

Global

·       The G7 Leaders’ Summit begins in Alberta, Canada and goes through June 17.  In advance of the meeting, the 50th G7 meeting, Canadian Prime Minister Mark Carney, who is chairing the Summit, announced the priorities for the meeting will include: “1) Protecting our communities and the world—strengthening peace and security, countering foreign interference and transnational crime, and improving joint responses to wildfires. 2) Building energy security and accelerating the digital transition—fortifying critical mineral supply chains and using artificial intelligence and quantum to unleash economic growth, and 3) Securing the partnerships of the future—catalyzing enormous private investment to build stronger infrastructure, create higher-paying jobs, and open dynamic markets where businesses can compete and succeed.

·       It is Father’s Day, celebrated globally. 

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Peru GDP Growth Rate (April)/ Unemployment Rate (May)

Asia

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Europe

Political/Social Events –

·       There will be an informal meeting of EU Agricultural Ministers through June 17 in Warsaw.

Economic Reports/Events –

·       Nothing significant to report.

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Israel Balance of Trade (May)/ GDP Growth Annualized 2nd Est Q1/ Unemployment Rate (May)

·       Saudi Arabia Inflation Rate (May)/ Wholesale Prices (May)

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

U.S. Financial Regulatory Week Ahead

Bowman Sworn in as Fed Vice Chair, House Financial Services Committee Readies Package of Banking Bills, and the Senate Banking Committee’s Controversial Reconciliation Provisions

June 9 - 13, 2025

The big news of the week is Michelle Bowman was confirmed Wednesday by the U.S. Senate as the new Federal Reserve Vice Chair for Supervision.  Bowman, a former community banker, wasted no time, giving her first speech Friday outlining her priorities in a speech entitled “Taking a Fresh Look at Supervision and Regulation.”  Bowman made clear in the speech that she is deeply focused on encouraging regulatory tailoring, undertaking a strategic reevaluation of bank capital requirements, reviewing a host of regulations and rules passed in the last administration by her predecessor, and streamlining the review process for bank mergers and de novo applications.

 Meanwhile, there has been and will be this coming week a lot of action in Congress.  This past Wednesday, the Senate Banking Committee offered up a number of provisions in a bid to help pay for H.R. 1, the One Big Beautiful Bill Act (OBBBA) – otherwise known as the Reconciliation bill.  But what the committee provided – totally a little over $1 billion in possible budget savings – may not pass muster with the Senate Parliamentarian as it appears a number of the provisions do not meet the strict rules for what can be included in a Reconciliation bill. 

What Senate Banking offer includes changing the Federal Reserve employees’ pay scale, zeroing out the entire budget of the Consumer Financial Protection Bureau (CFPB), dissolving the Public Company Accounting Oversight Board (PCAOB) and folding its functions into the SEC, and getting rid of the Treasury Department’s Office of Financial Research.  We will likely know in the coming week what the Parliamentarian decides.

This coming week in the Senate, the Senate Agriculture Committee will finally hold a confirmation hearing for Brian Quintenz to serve as Chair of the Commodities Futures Trading Commission (CFTC).  Quintenz was nominated months ago, but for a variety of reasons, his confirmation hearing was held up.

And Treasury Secretary Scott Bessent and Housing and Urban Development Secretary Scott Turner will testify before the Senate Appropriations Committee on Thursday on their respective departments’ 2026 budget requests.

Also this week, the House Financial Services Committee will hold a markup hearing for eight pieces of legislation, mainly focused on securities regulation.   Committee Chair Representative French Hill (R–AR) has been wanting to move on his recently introduced crypto market structure bill, and we believe he will likely seek a mark-up on that bill the week after next.

 Finally, we would note that this past Wednesday, Treasury Secretary Scott Bessent held a Financial Stability Oversight Council (FSOC) meeting (we cannot find any notice of the meeting being sent around beforehand).  According to the read-out of the meeting,

“Council members heard updates from the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation (FDIC), and the Office of the Comptroller of the Currency (OCC) on their efforts to enhance their supervisory and regulatory frameworks and to focus bank supervision on material financial risks.  Members also discussed their continued collaboration to facilitate support for economic growth by banks and other financial institutions.

Additionally, the Council received a briefing by Treasury staff on the work of the President’s Working Group on Digital Asset Markets.  The Chairman of the Securities and Exchange Commission (SEC) and the Acting Chairman of the Commodity Futures Trading Commission also provided updates on their agencies’ recent actions.  The speakers discussed ongoing efforts to promote U.S. leadership in digital assets and financial technology and to provide greater regulatory clarity and certainty to digital asset markets. 

The Council also received a presentation from FDIC, OCC, and Federal Housing Finance Agency staff on commercial real estate (CRE).  The presentation noted stabilization across CRE sectors despite some continued headwinds in the office and multifamily segments.  It also described actions taken by supervisors to mitigate CRE risks at their regulated institutions in recent years.

In addition, the Council heard an update by Treasury, SEC, and Office of Financial Research staff on market developments related to corporate credit, including the continued growth of private credit.  The presentation noted that corporate fundamentals remain solid, although firms with lower credit ratings, higher leverage, and a greater share of floating-rate liabilities are more exposed to potential challenges.  Council members discussed ways in which private credit can promote investment and access to capital, as well as potential vulnerabilities that warrant continued monitoring.” 

Finally, we note that the Brookings Institution is holding a day-long conference on the history of bank supervision in the United States - “The History of Bank Supervision in America and the Road Ahead.”  There are a number of excellent scholars and former regulators speaking and it should be quite interesting.

Below are the other regulatory events we are watching in the coming week:  

U.S. Congressional Hearings 

U.S. Senate

• Tuesday, June 10, 3:00 p.m. – The Senate Agriculture Committee will hold a confirmation hearing for Brian Quintenz to be the next Chair of the Commodities Futures Trading Commission.

• Wednesday, June 11, 3:30 p.m. – The Senate Appropriations Committee’s Subcommittee on Financial Services and General Government will hold a hearing on the Fiscal Year 2026 U.S. Treasury Department Budget Request.  Treasury Secretary Scott Bessent will testify.

• Wednesday, June 11, 3:30 p.m. – The Senate Appropriations Committee’s Subcommittee on Transportation, Housing and Urban Development will hold a hearing on the Fiscal Year 2026 U.S. Department of Housing and Urban Development Budget Request.  HUD Secretary Scott Turner will testify.

• Thursday, June 12, 10:00 a.m. – The Senate Banking Committee will hold a nomination hearing for Ben DeMarzo to be Assistant Secretary for the Department of Housing and Urban Development,  Craig Trainor to be Assistant Secretary for the Department of Housing and Urban Development, Jovan Jovanovic to be Chairman of the Export-Import Bank, Francis Brooke to be the Assistant Secretary at the Department of the Treasury; and  David Peters to be Assistant Secretary, at the Department of Commerce.

House of Representatives

• Tuesday, June 10, 10:00 a.m. – The House Financial Services Committee will mark-up eight separate pieces of legislation.  These include:

•   H.R. 225, the HUD Transparency Act of 2025 

• H.R. 2808, the Homebuyers Privacy Protection Act

• H.R. 2835, the Small Bank Holding Company Relief Act  

• H.R. 3633, the Digital Asset Market Clarity (CLARITY) Act of 2025

• H.R. 3645, the Amendment for Crowdfunding Capital Enhancement and Small-business Support (ACCESS) Act 

• H.R. 3672, the Securities Research Modification Act  

• H.R. 3709, the Advancing the Mentor-Protégé Program for Small Financial Institutions Act

• H.R. 3716, the Systemic Risk Authority Transparency Act 

• Thursday, June 12, 10:00 a.m. – The House Financial Services Committee’s Subcommittee on National Security, Illicit Finance, & International Financial Institutions will hold a hearing entitled “Evaluating the Defense Production Act.”

• Thursday, June 12, 2:00 p.m. – The House Financial Services Committee’s Housing and Insurance Subcommittee holds a hearing on "Housing in the Heartland: Addressing Our Rural Housing Needs."

Federal Department & Regulatory Agency Meetings & Events

Federal Reserve Board and Federal Reserve Banks

· There are no speeches or events scheduled at this time as it is within the two-week “Blackout Period” in advance of the Fed’s Open Market Committee meetings on June 17-18.

U.S. Treasury Department

·       Wednesday, June 11, 3:30 p.m. – The Senate Appropriations Committee’s Subcommittee on Financial Services and General Government will hold a hearing on the Fiscal Year 2026 U.S. Treasury Department Budget Request.  Treasury Secretary Scott Bessent will testify.

Department of Commerce

·       There are no significant events scheduled at this time.

Department of Housing and Urban Development

·       Wednesday, June 11, 3:30 p.m. – The Senate Appropriations Committee’s Subcommittee on Transportation, Housing and Urban Development will hold a hearing on the Fiscal Year 2026 U.S. Department of Housing and Urban Development Budget Request.  HUD Secretary Scott Turner will testify.

Small Business Administration

·       There are no significant events scheduled at this time.

Securities and Exchange Commission

·       Monday, June 9, 1:00 p.m.—The SEC holds its Crypto Task Force Roundtable entitled “Spring Sprint Toward Crypto Clarity” at the SEC Headquarters.  SEC Chair Paul Atkins and the other four SEC Commissioners will attend and speak.

· Wednesday, June 11, 11:00 a.m. – The SEC, in conjunction with the CFTC, the US Secret Service, and the FBI, will hold an event to highlight World Elder Abuse Awareness Day.

·       Wednesday, June 11, 1:00 p.m. – The SEC will hold an Open Meeting to consider action relating to the compliance date for the amendments to Form PF that were adopted on February 8, 2024.

Commodities Futures Trading Commission

·       Thursday, June 12, 11:20 a.m. – CFTC Acting Chair Caroline Pham will speak on a panel entitled “The Next Frontier: Crypto Derivatives and Onchain Trading” at the State of the Crypto Summit 2025 Conference in New York.

Federal Deposit Insurance Corporation

·       There are no significant events scheduled at this time.

Office of the Comptroller of the Currency

·       There are no significant events scheduled at this time.

The Consumer Financial Protection Bureau

·       There are no significant events scheduled at this time.

FINRA

·       There are no significant events scheduled at this time.

National Credit Union Administration

·       There are no significant events scheduled at this time.

Federal Trade Commission & Department of Justice Antitrust Division

·       There are no significant events scheduled at this time.

Farm Credit Administration

·       Thursday, June 12, 10:00 a.m. – the Farm Credit Administration Board meets to receive the Quarterly Report on Economic Conditions and Farm Credit System Condition and Performance and the Semiannual Report on Office of Examination Operations.

Farm Credit Insurance Corporation

·       There are no significant events scheduled at this time.

International Monetary Fund & World Bank

·       Thursday, June 12, 6:00 p.m. – World Bank President Ajay Banga will speak at the Council on Foreign Relations in New York.

North American Securities Administrators Association

·       There are no significant events scheduled at this time.

Trade Associations & Think Tank Events

Trade Associations

·       Wednesday – Friday,  June 10 -13 – The American Bankers Association holds its Risk and Compliance Conference in Indianapolis, Indiana.

·       Thursday, June 12, 9:00 a.m. – SIFMA hosts the C&L Society Forum in New York.

Think Tanks and Other Events

·       Tuesday, June 10, 9:00 a.m. – 3:00 p.m. – The Brookings Institution will hold a conference entitled “The History of Bank Supervision in America and the Road Ahead.”   Former OCC Acting Comptroller Michael Hsu and former Treasury Deputy Secretary Sarah Bloom Raskin will be among the many speakers. 

Recommended Reading

• The Bonfire of the Banking Regulators?   Willem Buiter/Project Syndicate

  Buiter, the former chief economist at Citibank and a former member of the Monetary Policy Committee of the Bank of England, argues Despite numerous reforms, the US financial regulation system remains a patchwork of federal and state agencies with overlapping mandates and conflicting objectives. Two new books underscore the need to streamline bureaucracy, simplify regulations, and separate money creation from financial intermediation.

• New Report Highlights Growing Burden of U.S. GSIB Surcharge on American Economy   Financial Services Forum The Financial Services Forum today released a research paper analyzing the growing capital surcharges imposed on U.S. global systemically important banks (GSIBs) and the broader implications for the financial system and economy.  The key findings of the report include:

  • Rising GSIB Surcharges: The analysis shows that capital surcharges for U.S. GSIBs have continued to increase, largely driven by growth in safe assets such as bank reserves and U.S. Treasuries.

  • Uneven Global Standards: Unlike their international counterparts, U.S. GSIB scores are not adjusted for overall financial system growth, resulting in disproportionately higher scores and surcharges for U.S. banks.

  • Economic Implications: Without reform, GSIB scores and surcharges are expected to continue rising, potentially constraining bank lending and posing broader economic challenges

• Overcoming constraints: How banks helped US firms reroute their supply chains   VoxEU/Centre for Economic Policy Research

  Rising trade tensions and the pandemic have forced importers to reconfigure their supply chains – a complex and costly process. This column highlights the underappreciated role of financial intermediaries in supporting supply chain resilience during global disruptions. Commercial banks – especially those specializing in Asian trade finance – played a crucial role in helping firms manage this transition after the 2018–2019 tariffs. By meeting importers’ increased demand for credit and offering valuable information about potential suppliers, specialized banks helped tariff-hit firms diversify away from China faster and more successfully.

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Recommended Weekend Reads

What To Do When The START Treaty Expires, China’s Strategy for Countering the US’s New Focus on Latin America, the Economic and Geopolitical Implications of Apple’s Supply Chain, and Why Denmark Raised the Retirement Age to 70

June 6 - 8, 2025

Below is a collection of studies and articles we found particularly interesting and of likely impact on markets and public policy.  We hope you find them helpful and that you have a great weekend.

The Future of Nuclear Weapons and Arms Control 

• No New START     Franklin Miller/Eric Edelman, Foreign Affairs

  The looming expiration of the New START Treaty, the only remaining bilateral nuclear arms control agreement between the United States and Russia, has focused national security experts on what comes next. At the time it was signed in 2010, New START had some advantages. But New START was written for a geopolitical landscape that no longer exists.  Fifteen years later, the world has changed dramatically. Putin and Chinese leader Xi Jinping have emerged as aggressive and expansionist leaders, both dedicated to building a much more modernized and lethal nuclear weapons system.

• Everything Changes but Nothing Changes: Can France Overcome Its Own Nuclear Doctrine?   War on the Rocks

  In a recent interview broadcast live on French television, President Emmanuel Macron said, “Ever since there has been a nuclear doctrine, Charles de Gaulle, there has been a European dimension of France’s vital interests.  I have remained ambiguous on what those vital interests are…” Does France consider defending European allies part of their vital interests?  Does France believe in extending a nuclear umbrella that covers Europe? These questions have been debated in France for decades, and with Russia’s aggression toward Ukraine, they have risen to a new level of focus and discussion.

Latin America 

• What Will China Do Next in Latin America?   Ryan Berg/Foreign Policy

  The second Trump administration has begun with a flurry of activity in Latin America. In the first 100 days, Secretary of State Marco Rubio visited both Central America and the Caribbean, Secretary of Defense Pete Hegseth made a visit to Panama, and Secretary of Homeland Security Kristi Noem visited both South America and Central America and Mexico. Another visit to the region by Rubio and a trip by Secretary of Agriculture Brooke Rollins are in the works. Some administration officials have characterized their approach as an “Americas First” foreign policy. The reprioritization of Latin America in the United States’ foreign policy, coupled with the high-level visits by cabinet officials, has placed China on the back foot in the region—at least temporarily. In many ways, Beijing was unprepared for the Trump administration’s considerable focus on the Western Hemisphere and its scrutinizing of countries’ relationships with China.  Curiously, though, despite a revamped U.S. posture in Latin America, China appears to be sticking to a familiar bag of tricks—even as domestic challenges pare back the robustness of its offer.

• Momentum for Red Tape Reform in Chile Picks Up    Americas Quarterly

  The decision by Chile’s government to scrap the massive Dominga copper and iron mining project in January, and the resulting court battles, have roiled debates over red tape and regulation in the country, where natural resources make up 77.6% of exports. These debates—which go far beyond the mining sector—have become a campaign issue ahead of the November general election as the business community demands lighter regulation and President Gabriel Boric defends his record and tries to forge compromises with his critics.

• The War on Trees – How Illegal Logging Funds Cartels, Terrorists, and Rogue Regimes   Foreign Affairs

  Around the world, nefarious state and nonstate actors are extracting enormous value from forests to fund their operations. The unlawful clearing of land and the harvest, transport, purchase, and sale of timber and related commodities have long been dismissed as a niche concern of environmental activists. But this is a mistake. Although unsustainable deforestation imperils the environment, illegal logging also poses an outsize—and underacknowledged—geopolitical threat. Environmental crime constitutes a growing economic and national security threat to the United States and countries around the world. Yet Washington has largely ignored illegal logging’s role in its fight against transnational criminal organizations, drug cartels, terrorists, and rogue regimes, as well as China’s part in this illicit trade.

Geoeconomics

• Why Emerging Markets Weathered Federal Reserve Tightening So Well    Steven Kamin/AEI Economic Policy Working Paper Series

  The steep rise in US interest rates that started in 2022 led many observers to anticipate severe difficulties for emerging market economies (EMEs). Unlike after the Volcker disinflation of the early 1980s or the bond market turmoil of 1994, however, most EMEs weathered the Fed’s monetary tightening in 2022-23 relatively well. In particular, EME dollar credit spreads, an indicator of potential financial distress, rose only moderately in those years before dropping to historically low levels in 2024. One reason that the EMEs weathered Fed tightening so well is that, simply put, Fed tightening is no longer as injurious to them as commonly believed; this likely reflects improvements in EME policies since the 1980s and 1990s that have bolstered their resilience. A second reason why EME spreads remained relatively contained in the face of rising interest rates is that US corporate credit markets remained buoyant, and their confidence spilled over to EMEs. We show that US high-yield spreads accounted for the lion’s share of the fluctuations in EME spreads over the past couple of decades, dominating not only the effects of monetary shocks but also changes in the VIX and the dollar.

• Connectivity Policy – A Strategic Tool for the EU in its Eastern Neighborhood German Council on Foreign Relations

  Given the shifts in the geopolitical landscape, connectivity is no longer just an economic tool – it has become a strategic instrument used for influence, resilience, and security, as China has demonstrated with its Belt and Road Initiative. The EU must understand that connectivity is central to its engagement with the Eastern Partnership (EaP) countries, where the EU faces growing competition not only from China’s BRI but also from Russia’s infrastructure dominance and Turkey’s regional ambitions. This memo explores the new momentum that connectivity has gained as a part of the EU foreign policy in the EaP and examines its significance in the emerging new regional order. It assesses whether and how connectivity can be reframed as a strategic instrument for the EU’s engagement.

• Apple’s Supply Chain: Economic and Geopolitical Implications    Chris Miller/Vishnu Venugopalan – American Enterprise Institute

  Over the past decade, many electronics firms have talked about diversifying their supply chains. An analysis of Apple—America’s biggest consumer electronics firm—illustrates that most of its manufacturing supply chain remains in China, though there have been limited increases in Southeast Asia and India. China’s role for Apple has grown substantially. Ten years ago, Apple relied on China primarily for final assembly, while today Apple not only assembles devices in China, it also sources many components from the country.  However, Chinese-owned firms generally only play a role in lower-value segments of the supply chain. Many of the higher-value components—even those made in China—are produced in factories owned by Japanese, Taiwanese, or US firms.  

Immigration and Demographics

• America’s Immigration Mess: An Illustrated Guide   Nicholas Eberstadt/American Enterprise Institute

  Immigration was a flashpoint in American politics long before President Biden’s election, but it became a major political fiasco with the Biden Administration’s mismanagement of illegal immigration. Immigration ended up being one of the top issues in the 2024 election and is widely recognized as one of the key factors contributing to the re-election of President Trump. America is poised for a very different set of immigration policies today. But wherever America aims to head with immigration policy, it is essential to guide that policy with accurate information. This illustrated guide is intended to offer a summary snapshot of America’s immigration situation today, and some of the dilemmas attending it. In this illustrated guide we collect what we take to be the most accurate data and information on a number of hotly debated questions: trends in total and illegal immigration; the Biden era migration surge and its components; immigrants’ contributions to the national economy, dependence of US social welfare benefits, and impact on the budget deficit and national debt.

• Why Denmark is raising its retirement age to 70, Europe’s highest  Rangvid’s Blog

  The Danish parliament recently decided to raise the retirement age in Denmark to 70, effective from 2040. This decision attracted significant international attention. In this post, I will explain why the decision was made, the benefits it offers, and why, overall, the Danish pension system is strong, arguably among the best in the world. That said, it is not without its challenges.

The Global Week Ahead

Major Elections Dominate the Week Ahead, the US Pushes Asian Allies to Ramp Up Defense Spending to 5% of GDP,  the US Senate Takes Up the Reconciliation Bill, and the ECB Decides Rates

Major elections dominate the geopolitical calendar this week.  First, Poland is holding important presidential run-off elections.  At the time of this writing, the race is too close to call, but it appears conservative historian Karol Nawrocki is slightly ahead, and official results are expected to be announced Monday.  If Nawrocki wins, it will be seen as a defeat for both the current ruling coalition led by Prime Minister Donald Tusk and the European Union, as Nawrocki is perceived as an EU skeptic. 

Also happening on Sunday, Mexico is voting for its judiciary for the first time.  More than 2,600 federal, state, and local court seats are being voted on, moving the country away from an appointment-based system. It also makes Mexico the only country in the world to elect all its judges.  The move to an elected judiciary was championed by former President Andrés Manuel López Obrad (AMLO) and his successor, President Claudia Sheinbaum. Proponents say it will rid corruption from the judiciary, while critics argue it will politicize the judiciary and allow drug cartels to further influence judges.

The third big election this week is in South Korea, where voters will select a new president following the recent impeachment of President Yoon Suk Yeol, who tried to seize control by declaring martial law six months ago.  The South Korean political system has been chaotic ever since, but voters appear to be leaning toward electing left-wing Democratic Party leader Lee Jae-myung.   With the economy experiencing slower growth, the election will likely result in a seismic political and economic change in the months ahead.

We would note US Defense Secretary Pete Hegseth’s speech at the Shangri-la Security Conference this past week.  Hegseth made headlines by saying a potential invasion of Taiwan by China is more likely than ever before.  He also called on US allies in Asia to increase their defense spending to 5% of their GDP.   He also formally requested that Australia immediately raise its defense spending to 3.5% from the current rate, which is putting the country on track to hit 2.4% by 2030.

In Turkey on Tuesday, low-level meetings between Russian and Ukrainian diplomats are scheduled to take place.  No breakthroughs are expected despite President Donald Trump’s urging Russia to end the war immediately.  The meeting will take place in advance of the Ukraine Defense Contact Group – made up of NATO defense ministers – meeting in Brussels on Wednesday to discuss how to further support Ukraine. 

Also in Europe this week, the European Commission is scheduled to release a report recommending that Bulgaria adopt the Euro by 2026, further integrating the nation into the European Union.  

Moving to the US, Congress returns from their week-long Memorial Day recess, and the US Senate will begin debating President Trump’s “One Big Beautiful Bill,” which was passed by the House of Representatives ten days ago. 

The House bill is estimated to cost $2.5 trillion over the next ten years. But with new estimates suggesting the House version of the bill will actually add $3.8 trillion to the US deficit and Moody’s recent downgrade of US debt, senators are privately suggesting they intend to significantly cut the size of the package while wrestling over whether to include major tax provisions such as Section 899 which is seen as a revenge tax on foreign countries the US deems have “unfair” tax policies that discriminate against US businesses and investor.  Foreign investment firms operating in the US have already swung into action, lobbying furiously against the provision, saying if the provision is included in a final bill, it will drive them out of the US. 

Currently, by our count, there are at least five Republican senators prepared to vote against the current version of the overall package, enough to block the bill from moving forward.  We expect weeks, if not months, of negotiations between Senate Republicans, President Trump, and House Republicans as they attempt to finalize a comprehensive agreement.

Looking at the global economic radar screen, the European Central Bank (ECB) meets this week to consider interest rates. Market consensus suggests the ECB will cut rates another 25 basis points, bringing rates down 2%.

Elsewhere in Europe, the Eurozone reports May CPI prints on Tuesday while Germany reports factory orders, industrial production, and their trade balance.  France also reports industrial production and their trade balance this week, too. 

Turning to Asia, Japan will be releasing wage data and the Q1 Ministry of Finance Corporate Survey.  China releases May PMIs and the Caixin indices this week. 

And bringing it back to the US, jobs reports are out Friday after the JOLTS report comes out Tuesday and the ADP report comes out on Wednesday.  Also, this week, May ISMs (manufacturing and services) are out.  And markets are going to be listening to Fed Chair Jay Powell when he gives remarks Monday at the Fed’s 75th International Finance Conference, following Powell’s face-to-face meeting with President Trump this past week.

Below are all the other major geopolitical and geoeconomic events we are tracking this coming week:

Sunday, June 01, 2025

Global

·       OPEC+ meeting takes place to review market conditions and oil prices.

·       Today is the first day of summer in the Northern Hemisphere.  It is also the official first day of the Atlantic hurricane season.

Americas

Political/Social Events –

·       Mexico holds judicial elections. Voters for the first time will vote to elect all nine members of the Supreme Court, tow magistrates of the Superior Chamber of the Electoral Tribunal of the Federal Judiciary, 15 magistrates of the Regional Chambers of Electoral Tribunal, five members of the Judicial Disciplinary Tribunal, 464 circuit court magistrates, and 386 district court judges.   The vote comes after a highly controversial law was passed in 2024 by the Mexican parliament to move to judicial elections.  Critics argue the law politicizes the judicial system and opens the door to massive corruption and influence by the drug cartels.

Economic Reports/Events –

·       Federal Reserve Board Governor Christopher Waller will give a speech on the economic outlook at the 2025 Bank of Korea International Conference: Structural Shifts and Monetary Policy, Seoul, Republic of Korea.

Asia

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       South Korea Imports/ Exports/ Balance of Trade (May)

Europe

Political/Social Events –

·       Poland holds the second round of presidential elections.

·       Croatia holds local elections.

Economic Reports/Events –

·       Nothing significant to report.

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Today is Madaraka Day, celebrating the Republic of Kenya and when it gained self-rule in 1963.

Economic Reports/Events –

·       Nothing significant to report.

Monday, June 2, 2025

Global

·       At the UN, there will be a Plenary Meeting of the General Assembly for the Election of the President of the General Assembly for its Eightieth Session.  Former German Foreign Minister Annalena Baerbock is the leading contender for the post.

Americas

Political/Social Events –

· Canadian Prime Minister Mark Carney joins the elected heads of the countries’ provinces at the Meeting of First Ministers in Saskatoon.

·       The US Congress returns from a week off for Memorial Day. The US Senate will begin considering the Reconciliation bill (tax and 2025 budget) passed two weeks ago by the House of Representatives.

·       The US-China de minimus rate is set to increase to 54 percent.

Economic Reports/Events –

·        The Federal Reserve’s 75th Anniversary International Finance Conference will be held at the Federal Reserve in Washington, D.C.   Fed Chair Jay Powell will give opening remarks at 1:00 p.m.

·       Federal Reserve Board Governor Lisa Cook will give a speech on the economic outlook at the Peter McColough Series on International Economics: A Conversation With Lisa D. Cook in New York.

·       Dallas Federal Reserve Bank President Lorie Logan participates in moderated conversation before the Eleventh District Banking Conference hosted by the Federal Reserve Bank of Dallas.

·       Chicago Federal Reserve Bank President Austan Goolsbee participates in a moderated question-and-answer session before the 2025 Quad Cities Business Journal Mid-Year Economic Review.

·       Mexico Foreign Exchange Reserves (May)/ Business Confidence (May)/ S&P Global Manufacturing PMI (May)

·       Chile IMACEC Economic Activity (April)

·       Brazil S&P Global Manufacturing PMI (May)/ BCB Focus Market Readout

·       Canada S&P Global Manufacturing PMI (May)

·       USA S&P Global Manufacturing PMI (May)/ ISM Manufacturing PMI (May)

·       Peru Inflation Rate (May)

Asia

Political/Social Events –

·       China celebrates the Dragon Boat Festival. Financial markets are closed.

Economic Reports/Events –

·       Australia S&P Global Manufacturing PMI (May)/ ANZ-Indeed Job Ads (May)/ Commodity Prices (May)/ CoreLogic Dwelling Prices (May)

·       Japan Capital Spending Q1/ Jibun Bank Manufacturing PMI (May)

·       Indonesia S&P Global Manufacturing PMI (May)/ Import/ Export/ Balance of Trade (April)/ Inflation Rate (May)/ Tourist Arrivals (April)

·       Philippines S&P Global Manufacturing PMI (May)

·       South Korea S&P Global Manufacturing PMI (May)

·       Taiwan S&P Global Manufacturing PMI (May)

·       Vietnam S&P Global Manufacturing PMI (May)

·       India HSBC Manufacturing PMI (May)

·       Hong Kong Retail Sales (April)

·       Singapore SIPMM Manufacturing PMI (May)

·       Kazakhstan Inflation Rate (May)

Europe

Political/Social Events –

·       The EU-US justice and Home Affairs Ministerial meeting begins in Warsaw, Poland and runs through Wednesday.

·       The UK Government will publish its strategic defense review.  Defense Minister John Healy has said the report will “send a message to Moscow” over Russia’s aggression not only against Ukraine but other western nations including cyber-attacks on the UK military networks.

·       NATO Secretary General Mark Rutte will visit Vilnius, Lithuania and participate in the Vilnius Summit with B9 (Baltic 9) and Nordic countries.

·       The UK observes the June Bank Holiday -formerly known as White Monday.  Banks and markets are closed.

·       The 9th Annual Austrian World Summit begins in Vienna, Austria. The event is organized by the Schwarzenegger Climate Initiative, a body created by the Austrian-American actor Arnold Schwarzenegger.

Economic Reports/Events –

·       European Central Bank President Christine Lagarde gives a video message at the Conférence - REF 157: "Femmes et finance" organized by Association Europe-Finances-Régulations in Paris, France.

·       Bank of England Monetary Policy Committee member Catherine Mann joins a fireside chat at the Federal Reserve Board of Governors 75th International Finance Anniversary Conference in Washington, D.C.

·       Russia S&P Global Manufacturing PMI (May)

·       Switzerland Retail Sales (April)/ GDP Growth Rate Q1/ procure.ch Manufacturing PMI (May)

·       Hungary HALPIM Manufacturing PMI (May)

·       Poland S&P Global Manufacturing PMI (May)/ GDP Growth Rate Q1

·       Spain Tourist Arrivals (April)/ HCOB Manufacturing PMI (May)/ New Car Sales (May)

·       Turkey Istanbul Chamber of Industry Manufacturing PMI (May)/ Imports/ Exports/ Balance of Trade Prel (May)

·       Italy HCOB Manufacturing PMI (May)

·       France HCOB Manufacturing PMI (May)

·       Germany HCOB Manufacturing PMI (May)

·       Euro Area HCOB Manufacturing PMI (May)/ ECB President Lagarde Speech

·       Greece S&P Global Manufacturing PMI (May)

·       Great Britain BoE Consumer Credit (April)/ Mortgage Lending and Approvals (April)/ M4 Money Supply (April)/ Net Lending to Individuals (April)/ S&P Global Manufacturing PMI (May)/ Nationwide Housing Prices (May)

·       Serbia GDP Growth Rate Q1

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Israel Manufacturing PMI (April)

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nigeria Stanbic IBTC Bank Nigeria PMI (May)/ Foreign Exchange Reserves (May)

·       South Africa ABSA Manufacturing PMI (May)/ Total New Vehicle Sales (May)

·       Egypt Foreign Exchange Reserves (May)/ M2 Money Supply (April)

Tuesday, June 3, 2025

Global

·       At the UN, there will be a plenary meeting for the election of non-permanent members of the Security Council.  This includes two seats from Africa (DRC and Liberia), one from Asia (Bahrain), one from Latin America, and one from Eastern Europe (Latvia or Montenegro).

·       The 11th BRICS Parliamentary Forum will be held through Thursday at the Congresso Nacional in Brasilia, Brazil.

·       The Organization for Economic Cooperation and Development Ministerial Council meets in Paris, France.

Americas

Political/Social Events –

·       U.S. and Japanese trade envoys may hold their fifth round of trade talks on the sidelines of the Organization for Economic Cooperation and Development Ministerial Council in Paris, France, through June 4.

Economic Reports/Events –

·       Chicago Federal Reserve Bank President Austan Goolsbee participates in a moderated question-and-answer session before the 2025 Corridor Business Journal Mid-Year Economic Review.

·       Dallas Federal Reserve Bank President Lorie Logan gives opening remarks and moderates a discussion before a Fed Listens roundtable with El Paso community leaders.

·       Brazil IPC-Fipe Inflation (May)/ Industrial Production (April)

·       USA Redbook (May/31)/ JOLTs Job Openings & Quits (April)/ Factory Orders (April)/ RCM/TIPP Economic Optimism Index (June)/ Fed Goolsbee Speech/ Fed Logan Speech/ API Crude Oil Stock Change (May/30)/ LMI Logistics Managers Index (May)/ Total Vehicle Sales (May)

·       Colombia Davivienda Manufacturing PMI (May)

·       Paraguay Inflation Rate (May)

·       Uruguay Unemployment Rate (April)

Asia

Political/Social Events –

·       South Korea holds presidential elections.  The snap elections were called after six months of confusing and often chaotic rule following the impeachment of then-President Yoon Suk Yeol after he declared martial law.   Polls show left-wing candidate Lee Jae-myung has a comfortable lead to become the next president.

Economic Reports/Events –

·       Bank of Japan Governor Kazuo Ueda gives a speech at the Naigai Josei Chosa Kai meeting in Japan.

·       Bank of Japan Deputy Governor Shinichi Uchida will speak at the Society of Monetary Economics in Tokyo.

·       Sarah Hunter, assistant governor (economic) at the Reserve Bank of Australia gives a keynote speech at the Economic Society of Australia Queensland Business Lunch in Brisbane.

·       New Zealand Import Prices Q1/ Export Prices Q1/ Terms of Trade Q1/ Global Dairy Trade Price Index (June/03)

·       South Korea Inflation Rate (May)

·       Australia RBA Meeting Minutes/ Current Account Q1/ Company Gross Profits Q1/ Business Inventories Q1/ Net Exports Contribution to GDP Q1

·       Malaysia S&P Global Manufacturing PMI (May)

·       China Caixin Manufacturing PMI (May)

·       Pakistan Inflation Rate (May)/ Wholesale Prices (May)/ Balance of Trade (May)

Europe

Political/Social Events –

·       Russian and Ukrainian delegations are expected to meet in Istanbul, Turkey.

·        Italian Prime Minister Giorgia Meloni will meet with French President Emmanuel Macron in Rome, Italy. 

·       Russian Foreign Minister Sergie Lavrov hosts the Government Commission on Compatriots Living Abroad (GCCLA) meeting in Moscow.

Economic Reports/Events –

·       Bank of England Governor Andrew Bailey, Deputy Governor Sarah Breeden and rate-setters Catherine Mann and Swati Dhingra will appear in front of Parliament’s Treasury Committee.

·       Ireland AIB Manufacturing PMI (May)

·       Romania PPI (April)/ Unemployment Rate (April)

·       Hungary GDP Growth Rate Q1

·       Switzerland Inflation Rate (May)

·       France Budget Balance (April)

·       Slovakia Real Wages Q1

·       Spain Unemployment Change (May)

·       Turkey Inflation Rate (May)/ PPI (May)

·       Italy Unemployment Rate (April)/ New Car Registrations (May)

·       Euro Area Inflation Rate (May)/ Unemployment Rate (April)/ CPI Flash (May)

Middle East

Political/Social Events –

·       Syria is expected to re-open its stock market.

Economic Reports/Events –

·       Saudi Arabia Riyad Bank PMI (May)

·       Jordan PPI (April)

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Egypt S&P Global PMI (May)

·       South Africa GDP Growth Rate Q1

·       Nigeria GDP Growth Rate Q1

Wednesday, June 4, 2025

Global

·       At the UN,  there will be a Plenary Meeting of the General Assembly for the Election of members of the Economic and Social Council.

·       The BRICS Counter Terrorism Working Group meets in Brasilia, Brazil.

·       The Hajj Pilgrimage begins in Saudi Arabia.

Americas

Political/Social Events –

·       The 2nd Round of the US – Cambodia trade talks take place in Washington, D.C.

·       The Bloomberg Tech Summit takes place in San Francisco, California.

Economic Reports/Events –

·       The US Federal Reserve releases its Beige Book.

·       The Bank of Canada meets to decide interest rates and subsequent press conference.

·       Atlanta Federal Reserve Bank President Raphael Bostic gives welcome and closing remarks before a Fed Listens event, “How Monetary Policy and Macroeconomic Conditions Affect Individuals and Businesses"

·       USA MBA Mortgage Market Index (May/30)/ ADP Employment Change (May)/ Fed Bostic Speech/ S&P Global Composite & Services PMI (May)/ ISM Services PMI (May)/ EIA Crude Oil and Gasoline Stocks Change (May/30)

·       Mexico Gross Fixed Investment (March)

·       Canada Labor Productivity Q1/ S&P Global Composite & Services PMI (May

·       Brazil S&P Global Composite & Services PMI (May)

·       Colombia Exports (April)

Asia

Political/Social Events –

·       Today is the 26th Anniversary of the deadly crackdown on pro-democracy protesters in Beijing’s Tiananmen Square.

Economic Reports/Events –

·       South Korea Foreign Exchange Reserves (May)/ GDP Growth Rate Q1

·       Hong Kong S&P Global PMI (May)

·       Australia Ai Group Industry/ Construction/ Manufacturing Index (May)/ S&P Global Composite & Services PMI (May)/ GDP Growth Rate Q1/ GDP Capital Expenditure Q1/ GDP Chain Price Index Q1/ GDP Consumption Q1/ RBA Payments System Board Meeting

·       Japan Jibun Bank Composite & Services PMI (May)

·       Singapore S&P Global PMI (May)

·       Thailand S&P Global Manufacturing PMI (May)/ Business Confidence (May)

·       India HSBC Composite & Services PMI (May)

Europe

Political/Social Events –

·       The European Commission is expected to publish a report recommending Bulgaria be allowed to adopt the Euro.

·       The 9th Meeting of the EU-Republic of Moldova Association Council takes place in Brussels.

Economic Reports/Events –

·       European Central Bank Board Member Pedro Machado gives a keynote speech at the 2025 Harvard Law School/Program on International Financial Systems Europe-U.S. Symposium in Madrid, Spain.

·       Russia S&P Global Composite & Services PMI (May)/ Unemployment Rate (April)/ Business Confidence (May)/ Corporate Profits (March)/ Real Wage Growth (March)/ Retail Sales (April)/ GDP (April)

·       Spain Industrial Production (April)/ HCOB Composite & Services PMI (May)

·       Italy HCOB Composite & Services PMI (May)

·       France HCOB Composite & Services PMI (May)

·       Germany HCOB Composite & Services PMI (May)

·       Euro Area HCOB Composite & Services PMI (May)/ ECB Machado Speech

·       Great Britain S&P Global Composite & Services PMI (May)

·       Poland Interest Rate Decision (June)

Middle East

Political/Social Events –

·       A Turkish Commission of the ruling Justice and Development Party begins drafting a new constitution.

Economic Reports/Events –

·       United Arab Emirates S&P Global PMI (May)

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       South Africa S&P Global PMI (May)/ Business Confidence Q2

Thursday, June 5, 2025

Global

·       The World Energy Investment 2025 report is published by the International Energy Agency.

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Federal Reserve Board Governor Adriana Kugler will give a speech on the economic outlook and monetary policy at the Economic Club of New York Luncheon in New York.

·       Philadelphia Federal Reserve Bank President Patrick Harker speaks on the economic outlook before the Philadelphia Council for Business Economics.

·       Kansas City Federal Reserve Bank President Jeff Schmid speaks on banking policy at an event hosted by the Kansas City Fed.

·       Bank of Canada Deputy Governor Sharon Kozicki speaks at C.D. Howe Institute in Toronto.

·       USA Challenger Job Cuts (May)/ Imports/ Exports/ Balance of Trade (April)/ Initial Jobless Claims (May/31)/ Nonfarm Productivity Q1/ Unit Labour Costs Q1/ EIA Natural Gas Stocks Change (May/30)/ 15- & 30-Year Mortgage Rate (June/05)/Fed Balance Sheet (June/04)

·       Mexico Consumer Confidence (May)

·       Canada Imports/ Exports/ Balance of Trade (April)/ Ivey PMI s.a (May)

·       Uruguay Inflation Rate (May)

·       Brazil Balance of Trade (May)

·       Colombia PPI (May)

Asia

Political/Social Events –

·       The India-Central Asia Business Forum begins in New Delhi, India.

Economic Reports/Events –

·       European Central Bank Board Member Pedro Machado participates on a panel discussion at European Forum of Deposit Insurers (EFDI) International Conference “Embracing the Future on Solid Grounds: Reinforcing Financial Stability” in Madrid, Spain.

·       South Korea Current Account (April)

·       Japan Average Cash Earnings (April)/ Overtime Pay (April)/ Foreign Bond Investment (May/31)/ Stock Investment by Foreigners (May/31)/ Foreign Exchange Reserves (May)

·       Philippines Inflation Rate (May)

·       Australia Imports/ Exports/ Balance of Trade (April)

·       China Caixin Composite & Services PMI (May)

·       Thailand Inflation Rate (May)

·       Singapore Retail Sales (April)

·       Kazakhstan Interest Rate Decision/ PPI (May)

·       Taiwan Inflation Rate (May)/ Foreign Exchange Reserves (May)

Europe

Political/Social Events –

·       NATO Defense Ministers (the Ukraine Defense Contact Group) will meet in Brussels to discuss the current situation in Ukraine.

· The EU Transport, Telecommunications and Energy Council (Transport & Telecommunications) meets in Brussels through June 6.

§  The CBI National Business Dinner is held in London, traditionally addressed by a senior member of the government

Economic Reports/Events –

·       The European Central Bank meets to decide interest rates and press conference.

·       The ECONDAT 2025 spring meeting, hosted by the Bank of England, begins its two-day spring meeting at King’s College London. The conference brings together central bankers and researchers will gather to discuss the economics involved in non-traditional data and analytical tools.

·       OE Deputy Governor Sarah Breeden speaks on a webinar hosted by Odgers. The webinar is titled “H2 economic trends.”

·       Switzerland Unemployment Rate (May)

·       Germany Factory Orders (April)/ HCOB Construction PMI (May)/ New Car Registrations (May)

·       Euro Area HCOB Construction PMI (May)/ PPI (April)/ Deposit Facility Rate/ Marginal Lending Rate/

·       France HCOB Construction PMI (May)

·       Italy HCOB Construction PMI (May)/ Retail Sales (April)

·       Great Britain New Car Sales (May)/ S&P Global Construction PMI (May)

·       Ireland Current Account Q1/ GDP Growth Rate Q1/ GNP Q1/ Unemployment Rate (May)

·       Serbia PPI (May)

·       Turkey Foreign Exchange Reserves (May/30)

·       Ukraine Interest Rate Decision

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Kuwait M2 Money Supply (April)/ Private Bank Lending (April)

·       Jordan Unemployment Rate Q1

Africa

Political/Social Events –

·       Burundi holds parliamentary and local elections.

Economic Reports/Events –

·       South Africa Current Account Q1

·       Ghana Inflation Rate (May)

Friday, June 6, 2025

Global

·       Eid al-Adha, the second of the two main festivals in Islam, begins this evening. Celebrations and observances are generally carried forward to the three following days, known as the Tashreeq days.

Americas

Political/Social Events –

·       Brazilian President Luiz Inacio Lula da Silva (Lula) travels to France through June 7 for a State Visit.

Economic Reports/Events –

·       Brazil PPI (April)/ Car Production (May)/ New Car Registrations (May)

·       Chile Inflation Rate (May)

·       Canada Unemployment Rate (May)/ Participation Rate (May)

·       USA Unemployment Rate (May)/ Participation Rate (May)/ Government and Manufacturing and Nonfarm Payrolls (May)/ U-6 Unemployment Rate (May)/ Baker Hughes Total Rigs Count (June/06)/ Consumer Credit Change (April)/ Used Car Prices (May)

·       Ecuador Inflation Rate (May)

·       Costa Rica Inflation Rate (May)

Asia

Political/Social Events –

Japanese startup space company, ispace, will make a second attempt at a soft landing on the moon, aiming to become the first Asian private company to achieve such a feat. Its first attempt, in April 2023, ended with the lander crashing into the lunar surface..

Economic Reports/Events –

·       Japan Household Spending (April)/ Coincident Index Prel (April)/ Leading Economic Index Prel (April)

·       Philippines Unemployment Rate (April)/ Industrial Production (April)/ Consumer Confidence Q1/ Foreign Exchange Reserves (May)

·       Australia Building Permits (April)/ Private House Approvals (April)

·       Sri Lanka Tourist Arrivals (May)

·       Vietnam Balance of Trade (May)/ Foreign Direct Investment (May)/ Industrial Production (May)/ Inflation Rate (May)/ Retail Sales (May)/ Tourist Arrivals (May)

·       Indonesia Foreign Exchange Reserves (May)

·       India RBI Interest Rate Decision/ Cash Reserve Ratio/ Bank Loan Growth (May/23)/ Deposit Growth (May/23)/ Foreign Exchange Reserves (May/30)

·       Hong Kong Foreign Exchange Reserves (May)

·       Singapore Foreign Exchange Reserves (May)

Europe

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       European Central Bank Governing Council member Mario Centeno speaks about the outlook for the Portuguese economy in Lisbon.

· European Central Bank Board Member Robert Holzmann speaks at the presentation of the Austrian National Bank’s updated forecasts.

·       Germany Imports/ Exports/ Balance of Trade (April)/ Industrial Production (April)

·       Romania GDP Growth Rate Q1/ Retail Sales (April)

·       Great Britain Halifax House Price Index (May)/ BBA Mortgage Rate (May)

·       Hungary Industrial Production (April)/ Retail Sales (April)

·       France Imports/ Exports/ Balance of Trade (April)/ Industrial Production (April)/ Current Account (April)/ New Car Registrations (May)

·       Slovakia GDP Growth Rate Q1/ Retail Sales (April)

·       Switzerland Foreign Exchange Reserves (May)

·       Euro Area ECB Machado Speech/ Employment Change Q1/ GDP Growth Rate Q1/ Retail Sales (April)

·       Greece Balance of Trade (April)/ GDP Growth Rate Q1

·       Russia Interest Rate Decision/ CBR Press Conference/ Foreign Exchange Reserves (May)/ Vehicle Sales (May)

·       Poland Foreign Exchange Reserves (May)

·       Ukraine Foreign Exchange Reserves (May)

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       South Africa Foreign Exchange Reserves (May)

Saturday, June 7, 2025

Global

·       Nothing significant to report.

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Asia

Political/Social Events –

·       Indonesian President Prabowo Subianto is scheduled to visit Moscow for a meeting with Russian President Vladimir Putin. He will also attend the St. Petersburg International Economic Forum as a keynote speaker.

Economic Reports/Events –

·       China Foreign Exchange Reserves (May)

Europe

Political/Social Events –

·       French President Emmanuel Macron is scheduled to visit Monaco for meetings.

Economic Reports/Events –

·       European Central Bank President Christine Lagarde gives a keynote speech at the Blue Economy & Finance Forum in Monaco.

·       European Central Bank Board Member Isabel Schnabel participates on a panel discussion at 31st Dubrovnik Economic Conference of Hravtska Narodna Banka in Dubrovnik, Croatia.

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Sunday, June 8, 2025

Global

·       Today is Pentecost, a major feast in the Christian church marking the 50th day of Easter.

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Asia

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Europe

Political/Social Events –

·       Italy is set to hold a Constitutional referendum and run-off elections for regional elective office through Monday.  The Constitutional referendum concerns changes to the law on the acquisition of Italian citizenship for foreign residents and repeals some provision on employment as passed by a 2025 Jobs Act law.

Economic Reports/Events –

·       Nothing significant to report.

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Israel Business Confidence (May)/ Tourist Arrivals (May)

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

U.S. Financial Regulatory Week Ahead

Bank Regulators Ready Major Deregulatory Package, The HFSC Unveils A Crypto Market Structure Bill, and The US Chamber’s Capital Market Summit Brings out the Big Guns

June 2 - 6, 2025

We took last week off for a bit of vacation, but are back this week and looking at a busy regulatory week in Washington. 

Late Friday, Politico reported that bank regulators, under the guidance of Treasury Secretary Scott Bessent, are close to finalizing a major bank deregulation package.  The plan, worked out between the Federal Reserve, the OCC, and the FDIC, is likely to be released in the coming month and include a new supplementary leverage ratio and reductions on capital requirements.  Few details were revealed, but we expect more information to start leaking in the coming weeks.

The other major event this week and next is House Financial Services Committee Chair French Hill’s (R-AR) crypto market structure bill.  Hill unveiled the bill, named the CLARITY Act, on Thursday (You can read the section-by-section breakdown HERE), which seeks to overhaul how digital assets are regulated. 

Hill also got three House Democrats to cosponsor the legislation, and he intends to hold a full committee hearing this coming Tuesday.  Later in the day, Hill will speak about the bill and the crypto market at the US Chamber of Commerce’s Capital Markets Summit, being held at the Chamber’s Washington headquarters.

Speaking of the Capital Markets Summit, all the big names are lined up to speak: Hill, Acting Comptroller of the Currency Rodney Hood, Acting FDIC Chair Travis Hill, Treasury Deputy Secretary Michael Faulkender, and  a number of key senators and other members of the House Financial Services Committee.

Looking at what happened this past week, the other big news was that President Trump announced he is intent on spinning off mortgage giants Freddie Mac and Fannie Mae via a public offering.  But he also explicitly said the US government would retain guarantees and oversight of the entities.  All this comes as growing speculation as to whether and when Trump will formally launch a sovereign wealth fund (SWF), which could conceivably hold a sizeable stake in Freddie and Fannie.

Tied to this in some way, which is far from clear for markets, is President Trump’s announcement that he had helped structure a deal between Nippon Steel and US Steel that would include the US government holding “Golden Shares” in the merged entity.  Which government agency would hold those Golden Shares remains a mystery, but again, speculation has begun to swirl that the SWF would serve that function.

Finally, we note that the House version of the Reconciliation that was recently passed has a provision taxing foreign remittances at a new 3.5 percent rate.  Banks are lobbying against the measure, arguing it is going to hurt their businesses and encourage alternative, less transparent ways to move money overseas.  Let’s see what the Senate does in the coming weeks as they take up the Reconciliation bill.

Below are the other regulatory events we are watching in the coming week:

U.S. Congressional Hearings 

U.S. Senate

·       There are no significant events scheduled at this time.

House of Representatives

·       Tuesday, June 3, 10:00 a.m. – The House Financial Services Committee will hold a hearing entitled American Innovation and the Future of Digital Assets: From Blueprint to a Functional Framework.

·       Tuesday, June 3, 2:15 p.m. – House Financial Services Committee Chair French Hill (R-AK) will speak at the US Chamber of Commerce’s Capital Market Summit on the Future of Financial Services in Washington, D.C.

·       Thursday, June 5, 10:00 a.m. – The House Financial Services Committee’s Subcommittee on Financial Institutions will hold a hearing entitled Framework for the Future: Reviewing Data Privacy in Today’s Financial System.

Federal Department & Regulatory Agency Meetings & Events 

Federal Reserve Board and Federal Reserve Banks

·       Sunday, June 1, 8:00 p.m. – Federal Reserve Board Governor Christopher Waller will give a speech on the economic outlook at the 2025 Bank of Korea International Conference: Structural Shifts and Monetary Policy, Seoul, Republic of Korea.

·       Monday – Tuesday, June 2-4 – The Federal Reserve’s 75th Anniversary International Finance Conference will be held at the Federal Reserve in Washington, D.C.   Fed Chair Jay Powell will give opening remarks at 1:00 p.m.

·       Tuesday, June 3, 1:00 p.m. – Federal Reserve Board Governor Lisa Cook will give a speech on the economic outlook at the Peter McColough Series on International Economics: A Conversation With Lisa D. Cook in New York.

·       Thursday, June 5, 12:00 p.m. – Federal Reserve Board Governor Adriana Kugler will give a speech on the economic outlook and monetary policy at the Economic Club of New York Luncheon in New York.

U.S. Treasury Department

·       Tuesday, June 3, 3:15 p.m. – Deputy Secretary of the Treasury Michael Faulkender will speak at the US Chamber of Commerce’s Capital Markets Summit on Driving US Competitiveness in Financial Markets.

Department of Commerce

·       There are no significant events scheduled at this time.

Department of Housing and Urban Development

·       There are no significant events scheduled at this time.

Small Business Administration

·       There are no significant events scheduled at this time.

Securities and Exchange Commission

·       Tuesday, June 3, 10:30 a.m. – SEC Commissioner Mark Uyeda will speak at the US Chamber of Commerce Capital Market Summit in Washington, D.C.

·       Tuesday, June 3, 2:30 p.m. – SEC Chair Paul Atkins will testify before the U.S. Senate Appropriations Committee regarding the SEC’s 2026 Budget Request.

·       Wednesday, June 4, 1:00 p.m. – The SEC will hold an open meeting to consider whether to issue a concept release on the definition of a foreign private issuer.

·       Thursday, June 5, 9:00 a.m. – The SEC’s Division of Investment Management is hosting its Conference on Emerging Trends in Asset Management at the SEC’s headquarters in Washington, D.C.

·       Thursday, June 5, 10:00 a.m. – The SEC’s Investor Advisory Committee will meet at the SEC Headquarters in Washington, D.C.  Among the issues they will discuss is a draft recommendation regarding the use of mandatory arbitration clauses by registered investment advisors.

Commodities Futures Trading Commission

·       There are no significant events scheduled at this time.

Federal Deposit Insurance Corporation

·       Tuesday, June 3, 11:00 a.m. – FDIC Chair Travis Hill will speak at the US Chamber of Commerce’s Capital Market Summit in Washington, D.C.

Office of the Comptroller of the Currency

·       Tuesday, June 3, 9:35 a.m. – Acting Comptroller Rodney Hood will speak at the US Chamber of Commerce’s Capital Markets Summit in Washington, D.C.

The Consumer Financial Protection Bureau

·       There are no significant events scheduled at this time.

FINRA

·       There are no significant events scheduled at this time.

National Credit Union Administration

·       There are no significant events scheduled at this time.

Federal Trade Commission & Department of Justice Antitrust Division

·       There are no significant events scheduled at this time.

Farm Credit Administration

·       There are no significant events scheduled at this time.

Farm Credit Insurance Corporation

·       There are no significant events scheduled at this time.

International Monetary Fund & World Bank

·       There are no significant events scheduled at this time.

North American Securities Administrators Association

·       There are no significant events scheduled at this time.

Trade Associations & Think Tank Events

Trade Associations

·       Tuesday, June 3, 9:00 a.m. – SIFM and E&Y will hold a Forum entitled AI in Capital Markets and Wealth and Asset Management in New York.

·       Tuesday, June 3, 9:00 a.m. – The US Chamber of Commerce holds its annual Capital Markets Summit in Washington, D.C.  SEC Commissioner Mark Uyeda will speak as will FDIC Chair Travis Hill.  Later in the day, House Financial Services Committee Chair French Hill (R-AK) will speak as will Deputy Treasury Secretary Michael Faulkender.

·       Tuesday, June 3, 1:00 p.m. – The Institute for International Bankers will hold its 2025 Foreign Bank Governance Seminar in New York.

Think Tanks and Other Events

·       There are no significant events scheduled at this time.

Please let us know if you have any questions or would like to be added to our email distribution list.

Recommended Weekend Reads

Drilling Into The Macroeconomics of Tariff Shocks, The Potential of Seabed Mining, Iran’s Rapidly Shrinking Population, and Why Does Switzerland Have More Nuclear Bunkers Than Any Other Country?  

May 30 - June 1, 2025

Below is a collection of studies and articles that we found particularly interesting and likely to have an impact on markets and public policy.  We hope you find them useful and have a great weekend.

More Studies on the Economic Impact of Tariffs

• ·The Macroeconomics of Tariff Shocks    Adrien Auclert/Matthew Rognlie/Ludwig Straub  National Bureau of Economic Research

  Abstract: We study the short-run effects of import tariffs on GDP and the trade balance in an open-economy New Keynesian model with intermediate input trade. We find that temporary tariffs cause a recession whenever the import elasticity is below an openness-weighted average of the export elasticity and the intertemporal substitution elasticity. We argue this condition is likely satisfied in practice because durable goods generate great scope for intertemporal substitution, and because it is easier to lose competitiveness on the global market than to substitute between home and foreign goods. Unilateral tariffs do tend to improve the trade balance, but when other countries retaliate the trade balance worsens and the recession deepens. Considering the recessionary effect of tariffs dramatically brings down the optimal unilateral tariff level derived in standard trade theory.

• Trading Cases: Tariff Scenarios for Taxing Times   Wood Mackenzie

  The Trump administration’s ‘Liberation Day’ tariff announcement on 2 April was arguably the most pivotal moment for the world economy since China’s 2001 entry into the World Trade Organization. The White House’s numerous tariff-policy adjustments since early April have made understanding the impact and implications of the levies harder still. The potential for trade deals with major trading partners, further policy changes, and even a full U-turn in the US position add to the uncertainty.  The scale of the tariffs – be they already implemented or merely threatened – has far-reaching implications for the energy and natural resources sectors. The lower economic growth they entail will curb commodity demand, prices, and investment, while higher import prices will raise costs in sectors from battery storage to liquefied natural gas (LNG). Such uncertain times require planning for divergent outcomes. Wood Mackenzie has developed three distinct scenarios that consider the potential impacts on global GDP, industrial production, and supply, demand, and prices out to 2030 in four sectors: oil, gas and LNG, renewable power, and metals and mining.

• A Detailed Look at Trump’s Car Tariffs     Apricitas Economics Substack

  In any other administration, the announcement of 25% tariffs on cars & parts would be the single-largest economic story of the year—they currently hit more than $353B in US imports, having a larger economic effect than all of the tariffs implemented during Trump’s first term combined. These tariffs primarily affect imports from close American allies like the EU, Japan, & South Korea, who supply the majority of foreign-made cars to the United States. Yet the President won’t even spare the highly integrated North American supply chain, as tariffs currently apply to the non-US content in Mexican and Canadian-made vehicles.

• State of U.S. Tariffs s of May 29, 2025    The Budget Lab/Yale University

  This study estimated the effects of all remaining US tariffs and foreign retaliation implemented in 2025 through May 28, assuming all tariffs previously introduced under IEEPA authority are invalidated per the May 28 U.S. Court of International Trade Ruling, which leaves only tariffs introduced under Section 232 authority in place: tariffs on steel and aluminum as well as autos and auto parts. Consumers face an overall average effective tariff rate of 6.9%, the highest since 1969. The price level from all 2025 tariffs rises by 0.6% in the short-run, the equivalent of an average per household consumer loss of $950 in 2024$. Annual pre-substitution losses for households at the bottom of the income distribution are $800. The post-substitution price increase settles at the same 0.6%. The 2025 tariffs affect metals inputs and automobile prices primarily. The latter sees a 5% long-run price increase, the equivalent of an extra $2,400 on the cost of an average 2024 new car. US real GDP growth is -0.2pp lower from all 2025 tariffs. All tariffs to date in 2025 raise $686 billion over 2026-35, with $101 billion in negative dynamic revenue effects.

U.S.-Iran Nuclear Talks and Iran’s Disappearing Population

• What Would Russia Like From a New Iran Nuclear Deal?   Carnegie Politika

  U.S. President Donald Trump may have torn up the previous nuclear deal between the United States and Iran during his first term in office, but he now seems serious about signing a new one. Washington has not only held several rounds of talks with the Iranians but also dropped many of its demands.  That confronts Russia—which, united by a shared conflict with the West, has grown closer to Iran—with a dilemma: sabotage the negotiations in order to keep its ally isolated by sanctions, or try to become an important mediator in the agreement, as it was in the previous deal.

• Iran’s Seemingly Unstoppable Birth Slump   Middle East Forum Observer

  Despite exhortations from ruling clerisy to be fruitful, and pro-natal policies intended to prop up birth rates, fertility in Iran is slumping once again.  Earlier this month, the Tehran Times reported that annual births in Iran fell below the million mark. According to the Civil Registration Organization in charge of Iran’s vital statistics, just under 980,000 births were recorded between the Iranian calendar year coinciding with 21 March 2024 through 20 March 2025.  It has been a very long time since, so few babies were born in Iran. By the reckoning of the United Nations Population Division, we have to go back seventy years—to 1955—to find a year when Iranian annual birth totals were lower than today. The current birth level is less than half as high as it was forty years ago, in 1985.

The Changing Commercial and Security Aspects of Our Oceans

• The Potential Impact of Seabed Mining on Critical Mining on Critical Mineral Supply Chains and Geopolitics   Rand

  The potential emergence of a seabed mining industry has important ramifications for the diversification of critical mineral supply chains, revenues for developing nations with substantial terrestrial mining sectors, and global geopolitics. In this report, the authors present the results of a multi-pronged examination of each of these issues, exploring the likelihood and magnitude of their impacts to better inform planning and policymaking.  The authors found that the emergence of a seabed mining industry would introduce a new source of supply for critical minerals that are key elements for energy transition and defense technologies, and this would present several opportunities and challenges for the United States in terms of diversifying critical mineral supply chains away from China, cooperating with allies and partners, working with developing nations, and addressing environmental, regulatory, and security concerns. They offer several recommendations for the U.S. government to address these issues.
  

• The Transarctic Alliance is Key to U.S. National Security    Michael Sfraga/High North News

  Seven Arctic states are NATO allies (Canada, Finland, Denmark— by virtue of Greenland— Iceland, Norway, Sweden, and the US— by virtue of Alaska), and Arctic nations make up five of the sixteen founding NATO members.  Despite the current U.S. administration’s skepticism of the Alliance, it is in America’s best interest to reinforce and strengthen this strategic alignment. The Alliance is a bulwark against nations that seek to advance ideologies antithetical to democratic values and institutions, to use tools of national power to dismiss sovereign borders, to destabilize and invade neighboring countries, and to disrupt the international rules-based order.

• The bear beneath the ice: Russia’s ambitions in the Arctic   European Council on Foreign Relations

  Over the past decade, the Arctic has emerged as a strategic priority for Russia, second only to relations with post-Soviet countries, including Ukraine. Russia’s policy agenda in the Arctic is shaped by insecurities over its economic and military position in the region. This agenda forms a “policy iceberg”. The Kremlin’s massive economic investment is the visible tip; its attempts to create a northern sea trade route buoy at the waterline with both visible economic and murkier military aims; while its militarization in the Arctic is submerged from view—and the most threatening to Western interests. On the world stage, Russia’s Arctic policy is fragmented and tactical. It cherry-picks from international law, clumsily balances relations with big powers, and flirts with alternative Arctic institutions.  Europeans need to situate Russia’s growing ambitions in the region within Moscow’s broader strategic aims, especially in Ukraine, and respond by rethinking their Arctic policy through closer international engagement.

 Switzerland’s Nuclear Bunkers

• Why does Switzerland Have More Nuclear Bunkers Than Any Other Country?   The Guardian

  To the alternating fascination, bewilderment, and envy of its European neighbors, Switzerland, with a population of nearly 9 million, has more bunkers per capita than anywhere else in the world – enough to guarantee shelter space to every single resident in the event of a crisis. (Sweden and Finland are a close second, covering all major cities.)  But the question is, why?

The Global Week Ahead

Poland’s Holds Presidential Run-Off Election, Canada’s New Parliament Convenes, President Trump Bashes President Putin and Holds Off On EU Tariffs, and Markets Look Toward FOMC Minutes and Key Inflation Data

May 25 - June 1, 2025

It may be Memorial Day in the US and a Bank Holiday in the UK, but the otherwise shortened week is still going to be a very busy one. 

First, we would point to the upcoming Polish Presidential run-off elections this coming Sunday.  Polls are extremely close, and the two candidates have very different outlooks for the future of Poland.  Nationalist candidate Karol Nawrocki is facing off against pro-EU Warsaw May Rafal Trzaskowski who won a narrow victory in the first round.  2/5th of voters who voted for other candidates will decide the race which is seen as being important not only for Poland but for the EU.  Nawrocki opposes Prime Minister Donald Tusk’s reform agenda, which is strongly pro-EU and if he wins, it could cause the collapse of the Tusk coalition government.

Also this week, the new Canadian Parliament and governing coalition of Prime Minister Mark Carney begins.  The Parliament will convene with a historic – first time in more than 50 years – address by the reigning British Monarch, King Charles.  The King’s message is seen as being aimed as much at President Trump as Canada and will likely be an appeal for unity.

Here in the U.S., Congress is out of session this week for the Memorial Day holiday, but Washington will still be quite busy.  President Trump surprised many with withering criticism on Sunday of Russian President Vladimir Putin for massive new attacks on Ukraine.  Trump called Putin “crazy” and renewed calls for a ceasefire, or he would impose tough new sanctions on Russia. 

Meanwhile on the trade front, President Trump, after a phone call with European Union President Ursula von der Leyden, said he would hold off on new 50% tariffs on the EU until July 9th, citing “a very good conversation.”  

Meanwhile, Japanese negotiators will be meeting with Treasury Secretary Scott Bessent this week to try to hammer out a deal.  Markets were surprised on Friday when President Trump announced his support for Nippon Steel’s bid to acquire U.S. Steel – which he previously had opposed.  But no one knows the details of the deal and how it will be structured other than President Trump calling it “a partnership” in a Truth Social posting.

Adding to the U.S.-Japan trade talks was the surprise proposal by SoftBank Founder Masayoshi Son for the creation of a joint U.S.-Japan sovereign wealth fund to make large investments in tech and infrastructure in the U.S.  This may be an early indicator of not only where a trade deal may come out but also go in some way to the structure of the Nippon-U.S. Steel deal.

Asia is going to have a busy week with three big events taking place this week.  First, ASEAN leaders will gather in Malaysia to talk about U.S. tariffs and the future of trade and security in the region.  Second, the Shangri-la Dialogue – a large security conference – is being held in Singapore.  Military leaders and defense ministers – including U.S. Defense Secretary Pete Hegseth – will be attend.  Hegseth’s speech will likely be an important marker for the future of U.S. security policy in the region.

The third big event is French President Emmanual Macron’s tour of the region starting with a visit to Vietnam and then on to Indonesia and Singapore.  The visit is seen as both France’s and the EU’s increased engagement and focus on Asia and Asian security.

Looking at the global economic radar screen this week, in the US markets are focused on the PCE print on Friday as an indicator of where inflation is headed and how the Federal Reserve will respond.  Also out this week are trade figures on Friday, the Conference Board’s consumer confidence report on Tuesday and durable goods orders on Tuesday.  Also out this week is the Fed’s Open Market Meeting minutes.

In Europe, CPI prints are the big news of the week.  Germany, Italy, and Spain all report CPI on Friday.  Consumer confidence indices are out in Germany this week, too.  

Turning to Asia, markets are looking at the Japan’s CPI figures being released this week as well as consumer confidence figures on Thursday.  And China’s industrial profit figures are out this week, as well. 

Below are all the other major geopolitical and geoeconomic events we are tracking this coming week:

Sunday, May 25, 2025

Global

·       The World Health Assembly will convene its 78th session in Geneva, Switzerland, through May 27.

Americas

Political/Social Events –

·       In Venezuela, parliamentary and regional elections are scheduled to be held.  However, the elections are widely anticipated to be rigged to keep the regime of President Maduro further entrenched in power.

·       The International Chamber of Commerce arbitration hearing is held today to decide a dispute between ExxonMobil and Chevron over ownership of an enormous oil project in Guyana’s Stakbroek oilfield.  The value of the project is estimated to be as much as $1 trillion.

·       Suriname holds parliamentary elections.

Economic Reports/Events –

·       Federal Reserve Board Chair Jay Powell gives the Baccalaureate speech at the Princeton University graduation.

Asia

Political/Social Events –

·       ASEAN Foreign Ministers will meet in Kuala Lumpur.

·       French President Emmanual Macron begins his Southeast Asia tour, arriving in Vietnam on Sunday evening. Macron is scheduled to meet with Communist Party Chief To Lam and President Luong Cuong and witness a signing ceremony for bilateral agreements. He will then go to Jakarta to meet with Indonesian President Prabowo Subianto, followed by a trip to Singapore to deliver a keynote speech at the Shangri-La Dialogue on Friday.

Economic Reports/Events –

·       Nothing significant to report.

Europe

Political/Social Events –

·       The NATO Secretary General, Mark Rutte, will take part in the 2025 Spring Session of the NATO Parliamentary Assembly (NPA) in Dayton, United States..

Economic Reports/Events –

·       Nothing significant to report.

Middle East

Political/Social Events –

·       Israel celebrates Jerusalem Day – a national holiday – marking the day on the Hebrew calendar when the city was unified under Israeli rule after the 1967 War.

·       Iraq's electoral commission will open registration ahead of the Nov. 11 parliamentary elections.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Monday, May 26, 2025

Global

·       The BRICS 4th Working Group Meeting on new and Renewable Energy and Energy Efficiency meets in Tehran, Iran through May 28.

·       Today is an official holiday at the United Nations.  The Headquarters are closed.

Americas

Political/Social Events –

·       Today is Guyana Independence  Day, celebrating when the country declared its independence from Great Britain in 1966.

Economic Reports/Events –

·       Brazil FGV Consumer Confidence (May)/ Current Account (April)/ Foreign Direct Investment (April)

·       Canada Manufacturing Sales (April)

·       Brazil BCB Focus Market Readout

·       Peru GDP Growth Rate Q1

Asia

Political/Social Events –

·       The ASEAN Summit begins in Malaysia and runs through Wednesday.  Southeast Asian leaders will seek to strengthen the bloc's role as a stabilizing force in the region and address the situation in Myanmar. Following this, Malaysia – which is chairing this year’s Summit - will host the inaugural ASEAN-Gulf Cooperation Council-China Summit, where leaders are expected to address growing U.S. tariff pressures, deepening geopolitical rifts and regional crises..

Economic Reports/Events –

·       Thailand Import/ Export/ Balance of Trade (April)/ New Car Sales (April)

·       Japan Coincident Index Final (March)/ Leading Economic Index Final (March)

·       Singapore Industrial Production (April)

·       Hong Kong Imports/ Exports/ Balance of Trade (April)

·       Philippines Budget Balance (April)

Europe

Political/Social Events –

·       Newly elected German Chancellor Friedrich Merz will meet with Nordic prime ministers in southwest Finland.

·       Nicușor Dan, Romania’s president-elect, is expected to be sworn in at a ceremony in the nation’s parliament building in Bucharest.

·       The EU Agriculture and Fisheries Council meets in Brussels.  The ministers are expected to discuss the US tariff situation.

·       The EU Foreign Affairs Council (Development) meets in Brussels.  The meeting is the first the first one for the high representative Kaja Kallas, will dedicate the first session to financing for development.

·       Ministers will meet one month prior to the 4th International Conference on Financing for Development (FfD4), scheduled for 30 June – 3 July 2025 in Seville, Spain. This conference will focus on new and emerging issues, the pressing need to fully implement the Sustainable Development Goals (SDGs), and the ongoing reform of the international financial system.  The Council will also address EU-Africa relations as a follow-up to the 3rd EU-African Union ministerial meeting on May 22.

·       Today is Georgia Independence Day, celebrating when the country broke free from the Soviet Union.

Economic Reports/Events –

·       European Central Bank President Christine Lagarde participates in "Spotlight on Christine Lagarde: Europe's Role in a Fragmented World" event organized by Hertie School/Jacques Delors Centre in Berlin, Germany.

·       Ireland Consumer Confidence (May)

·       Switzerland Non-Farm Payrolls Q1

·       Spain PPI (April)

·       Poland Unemployment Rate (April)/ Retail Sales (April)

·       Slovenia Business Confidence (May)

·       Euro Area ECB President Lagarde Speech

Middle East

Political/Social Events –

·       Pakistani Prime Minister Muhammad Shehbaz Sharif will visit Iran, Turkey, and Azerbaijan through May 29.

Economic Reports/Events –

·       Saudi Arabia Imports/ Exports/ Balance of Trade (March)

·       Israel Manufacturing Production (March)/ Interest Rate Decision/ Composite Economic Index (April)/ Manufacturing PMI (April)

·       Kuwait M2 Money Supply (April)/ Private Bank Lending (April)

Africa

Political/Social Events –

·       The African Development Bank’s annual meetings take place in Abidjan, with a new president due to be announced on Thursday.

Economic Reports/Events –

·       Nigeria GDP Growth Rate Q1

Tuesday, May 27, 2025

Global

·       The UN Security Council is scheduled to hold elections to fill the vacancy in the International Court of Justice (ICJ).

·       in Copenhagen, Denmark, the Sixth Global Climate and SDG Synergies Conference will be co-convened by the UN Department of Economic and Social Affairs (UN DESA) and UNFCCC. Hosted by the Government of Denmark, the conference will continue until 28 May.

Americas

Political/Social Events –

·       King Charles addresses the state opening of parliament in Ottawa, the first time a ruling monarch has conducted this duty in person in 50 years.

·       Today is Memorial Day in the United States.  Financial markets are closed, and the US Congress is out of session this week.

Economic Reports/Events –

·       Minneapolis Federal Reserve Bank President Neel Kashkari speaks and participates in a policy panel before the Bank of Japan Institute for Monetary and Economic Studies Conference.

·       New York Federal Reserve Bank President John Williams participates in moderated discussion panel before the Bank of Japan Institute for Monetary and Economic Studies Conference.

·       Richmond Federal Reserve Bank President Thomas Barkin will be interviewed on Bloomberg Television.

·       USA Durable Goods Orders (April)/ S&P/Case-Shiller Home Price (March)/ House Price Index (March)/ CB Consumer Confidence (May)/ Dallas Fed Manufacturing Index (May)/ Money Supply (April)

·       Brazil IPCA mid-month CPI (May)

·       Canada Wholesale Sales (April)

·       Uruguay Interest Rate Decision

Asia

Political/Social Events –

·       Chinese Foreign Minister Wang Yi will be hosting 11 of his counterparts from China-friendly Pacific countries in Xiamen for the third China-Pacific Island Countries Foreign Ministers' Meeting (as Beijing aims to bolster its relationships with Pacific nations and deepen its influence in the region. This marks the first in-person gathering of its kind in China, following an online meeting and another held in Suva, Fiji.

Economic Reports/Events –

·       South Korea Consumer Confidence (May)

·       China Industrial Profits (YTD) (April)

·       Taiwan Consumer Confidence (May)

Europe

Political/Social Events –

·       The EU General Affairs Council meets in Brussels.  Ministers will discuss the carbon border adjustment mechanism and preparations for the June European Council, and an Article 7 procedure concerning Hungary (the Treaty on European Union’s Article 7 allows the suspension of certain rights from a member state.  The EU Commission has demanded that Hungary withdraw a draft transparency law aimed at limiting foreign funding of NGO’s and media organizations in the country. The EU is now taking up Article 7 against Hungary to try and force the issue).  The Council will also take up Spain’s request to include Catalan, Basque, and Galician in regulation No 1/1958 which governs the EU’s language regime. 

·       Today is the Late May Bank Holiday in the UK.  Financial markets are closed.

Economic Reports/Events –

·       European Union New Car Registrations (April)

·       Germany GfK Consumer Confidence (June)

·       Switzerland Balance of Trade (April)

·       France Inflation Rate (May)/ Unemployment Benefit Claims (April)/ Jobseekers Total (April)

·       Great Britain BoE Hauser Speech/ CBI Distributive Trades (May)

·       Euro Area Economic Sentiment (May)/ Consumer Confidence Final (May)/ Consumer Inflation Expectations (May)/ Industrial Sentiment (May)/ Selling Price Expectations (May)/ Services Sentiment (May)

·       Ireland Average Weekly Earnings Q1

·       Spain Business Confidence (May)

·       Hungary Deposit Interest Rate (May)/ Interest Rate Decision

Middle East

Political/Social Events – 

·       Iranian President Masoud Pezeshkian will visit Oman through May 28.  It is expected they will discuss the ongoing nuclear talks with the U.S. as well as other regional issues.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       South Africa Leading Business Cycle Indicator (March)

Wednesday, May 28, 2025

Global

·       The joint OPEC and non-OPEC ministerial monitoring committee meeting takes place in Vienna.

·       The UN Security Council is scheduled to hold a briefing on the Middle East, followed by consultations.

·       The BRIC High Level Meeting on Climate Change and Sustainable Development meets in Brasilia, Brazil.

·       The BRICS 2nd Rapid Security Channel Meeting takes place at the Central Bank of Brazil in Sao Paolo, Brazil.

Americas

Political/Social Events –

·       Today is the end of the wind-down period for Chevron’s and other western oil companies to drill for oil in Venezuela.

·       U.S. Vice President J.D. Vance speaks at the Bitcoin 2025 conference in Las Vegas.

·       EU President António Costa meets with Brazilian President Lula in Brasilia, Brazil.

·       Unions in Colombia are set to go on strike through May 29 over a government sponsored labor referendum.

·       The Caribbean Island of St. Martin celebrates Abolition Day, marking when slavery was abolished in 1848.

Economic Reports/Events –

·       Federal Reserve’s FMOC Minutes Released

·       Minneapolis Federal Reserve Bank President Neel Kashkari participates in conversation and Q&A at Keio University.

·       USA MBA Mortgage Market Index (May/23)/ MBA Purchase Index (May/23)/ Redbook (May/24)/ Richmond Fed Manufacturing Index (May)/ Dallas Fed Services Index (May)API Crude Oil Stock Change (May/23)

·       Colombia Business Confidence (April)

·       Brazil Net Payrolls (April)

Asia

Political/Social Events –

·       China will launch the Tianwen-2 asteroid sampling mission.

·       Today is the Founding of the Democratic Republic of Azerbaijan Day.

Economic Reports/Events –

·       South Korea Business Confidence (May)

·       Australia Construction Work Done Q1/ Monthly CPI Indicator (April)

·       New Zealand RBNZ Interest Rate Decision/ RBNZ Press Conference

·       Malaysia PPI (April)

·       Taiwan GDP Growth Rate Q1

·       India Industrial Production (April)/ Manufacturing Production (April)/ M3 Money Supply (May/16)

Europe

Political/Social Events –

·       Russian Foreign Minister Sergey Lavrov meets with Turkish Foreign Minister Fidan in Moscow.

·       EU President Ursula von der Leyden meets with Spanish Prime Minister Pedro Sanchez in Brussels.

Economic Reports/Events –

·       Bank of England Chief Economist Huw Pill gives a speech at the Oesterreichische Nationalbank and SUERF Annual Economics Conference 2025 in Vienna, Austria.

·       Germany Import Prices (April)/ Unemployment Rate and Change (May)/ Unemployed Persons (May)

·       France GDP Growth Rate Q1/ Household Consumption (April)/ Non-Farm Payrolls Q1/ PPI (April)

·       Turkey Economic Confidence Index (May)

·       Euro Area ECB Consumer Inflation Expectations (April)

·       Switzerland Economic Sentiment Index (May)

·       Slovenia Retail Sales (April)

·       Ireland Retail Sales (April)

·       Great Britain BoE Pill Speech

·       Russia Industrial Production (April)/ PPI (April)

Middle East

Political/Social Events –

·       Today is the 600th day since of the Hamas-Israel Conflict after Hamas launched its attack on civilians in Israel on October 7, 2023.

Economic Reports/Events –

·       Saudi Arabia M3 Money Supply (April)/ Private Bank Lending (April)

Africa

Political/Social Events –

·       The Africa Tax Symposium takes place in Kigali.

·       The Africa Internet Governance Forum will take place in Dar Es Salaam, Tanzania through May 31.

·       Today is national Day of Ethiopia, celebrating when the military regime of Megishu Haile Mariam was ended in 1991.

Economic Reports/Events –

·       Mozambique Interest Rate Decision

Thursday, May 29, 2025

Global

·       The UN Security Council is scheduled to vote on a draft resolution on South Sudan sanctions and on Libya. This will be followed by consultations on 1718 Committee.

·       Today is Ascencion Day in the Christian world, marking 40 days after Easter and the Ascension of Jesus into Heaven.

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Federal Reserve Board Governors Adriana Kugler gives a speech at the 5th Annual Federal Reserve Board Macro-Finance Workshop (Virtual)

·       Richmond Federal Reserve Bank President Thomas Barkin participates in a fireside chat before the Housing Partnership Network.

·       San Francisco Federal Reserve Bank President Mary Daly participates in fireside chat before the Oakland Rotary Club.

·       Dallas Federal Reserve Bank President Lorie Logan gives opening remarks and participates in moderated conversation before the Greater Waco Member Appreciation event.

·       Chicago Federal Reserve Bank President Austan Goolsbee participates in a moderated question-and-answer session before the 2025 Mackinac Policy Conference hosted by the Detroit Regional Chamber.

·       Brazil IGP-M Inflation (May)/ Bank Lending (April)/ Unemployment Rate (April)

·       Canada Average Weekly Earnings (March)/ Current Account Q1

·       USA GDP Growth Rate Q1/ Corporate Profits Q1/ Initial Jobless Claims (May/24)/ PCE Prices Q1/ Real Consumer Spending Q1/ Pending Home Sales (April)/ EIA Natural Gas Stocks Change (May/23)/ 15- & 30-Year Mortgage Rate (May/29)/ EIA Crude Oil & Gasoline Stocks Change (May/23)/ Fed Kugler Speech/ Fed Balance Sheet (May/28)

·       Chile Unemployment Rate (April)

·       Mexico Monetary Policy Meeting Minutes

Asia

Political/Social Events –

·       Nikkei will host the 30th Future of Asia forum, its flagship annual conference, in Tokyo over two consecutive days. This year's main theme is "Asia's challenge in a turbulent world." Political leaders set to attend the event include Japanese Prime Minister Shigeru Ishiba, Cambodian Prime Minister Hun Manet, Chief Adviser of Bangladesh Muhammad Yunus, Laotian President Thongloun Sisoulith and Palauan President Surangel Whipps Jr.

·       Early voting begins in South Korea in advance of the June 3 snap elections for president. Voters will be choosing a replacement for impeached President Yoon Suk Yeol.

Economic Reports/Events –

·       Japan Foreign Bond Investment (May/24)/ Stock Investment by Foreigners (May/24)/ Consumer Confidence (May)

·       New Zealand ANZ Business Confidence (May)

·       South Korea Interest Rate Decision

·       Australia Building Capital Expenditure Q1/ Plant Machinery Capital Expenditure Q1/ Private Capital Expenditure Q1

·       Singapore Import Prices (April)/ Export Prices (April)/ PPI (April)

Europe

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Hungary Balance of Trade (April)

·       Slovakia Business Confidence (May)/ Consumer Confidence (May)

·       Spain Retail Sales (April)

·       Turkey Imports/ Exports/ Balance of Trade Final (April)/ Foreign Exchange Reserves (May/23)

·       Italy Business Confidence (May)/ Consumer Confidence (May)/ Industrial Sales (March)

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       South Africa PPI (April)/ Interest Rate Decision/ Prime Overdraft Rate

·       Zimbabwe Inflation Rate (May)

·       Egypt M2 Money Supply (April)

Friday, May 30, 2025

Global

·       Today is the International Day of the Potato.

Americas

Political/Social Events –

·       The third round of U.S.-Japan trade talks will commence in Washington, D.C.

Economic Reports/Events –

·       San Francisco Federal Reserve Bank President Mary Daly participates in panel before virtual Reagan National Economic Forum.

·       Atlanta Federal Reserve Bank President Raphael Bostic gives welcome remarks before the Council for Economic Education's 2025 National Economics Challenge.

·       Chicago Federal Reserve Bank President Austan Goolsbee participates in moderated Q&A before “The Interview Show with Mark Bazer"

·       Brazil Gross Debt to GDP (April)/ Nominal Budget Balance (April)/ GDP Growth Rate Q1

·       Mexico Unemployment Rate (April)/ Fiscal Balance (April)

·       Canada GDP Growth Rate Annualized Q1/ Budget Balance (March)

·       USA Core PCE Price Index (April)/ Personal Income and Spending (April)/ Goods Trade Balance Adv (April)/ PCE Price Index (April)/ Retail Inventories Ex Autos (April)/ Wholesale Inventories (April)/ Chicago PMI (May)/ Michigan Consumer Sentiment Final (May)/ Baker Hughes Total Rigs Count (May/30)

·       Chile Copper Production (April)/ Industrial Production (April)/ Manufacturing Production (April)/ Retail Sales (April)

·       Colombia Unemployment Rate (April)/ Cement Production (April)

·       Uruguay Balance of Trade (April)

Asia

Political/Social Events –

·       The Shangri-la Dialogue, sponsored by the International Institute for Strategic Studies, begins in Singapore.  The conference hosts top military brass from around the world, which will stretch over the weekend, with issues ranging from the Ukraine war to Israel's actions in the Gaza Strip set to be discussed at the conference.  US Secretary of Defense Pete Hegseth will attend and speak.

Economic Reports/Events –

·       New Zealand ANZ Roy Morgan Consumer Confidence (May)/ Building Permits (April)

·       South Korea Industrial Production (April)

·       Japan Unemployment Rate (April)/ Jobs/applications ratio (April)/ Tokyo Core CPI (May)/ Industrial Production (April)/ Retail Sales (April)/ Housing Starts (April)/ Construction Orders (April)

·       Philippines Imports/ Exports/ Balance of Trade (April)/ PPI (April)

·       Australia Building Permits (April)/ Retail Sales (April)/ Housing Credit (April)/ Private House Approvals (April)/ Private Sector Credit (April)

·       Singapore Bank Lending (April)

·       Thailand Industrial Production (April)/ Current Account (April)/ Private Consumption and Investment (April)/ Retail Sales (March)

·       Malaysia M3 Money Supply (April)

·       Sri Lanka Inflation Rate (May)/ Balance of Trade (April)/ PPI (April)

·       India GDP Growth Rate Q1/ Government Budget Value (March)/ Government Budget Value (April)/ Foreign Exchange Reserves (May/23) 

Europe

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Great Britain Car Production (April)/ Nationwide Housing Prices (May)

·       Germany Retail Sales (April)/ Baden Wuerttemberg CPI (May)/ Bavaria CPI (May)/ Brandenburg CPI (May)/ Hesse CPI (May)/ North Rhine Westphalia CPI (May)/ Saxony CPI (May)/ Inflation Rate (May)

·       Hungary PPI (April)

·       Spain Inflation Rate (May)/ Current Account (March)

·       Switzerland KOF Leading Indicators (May)

·       Turkey GDP Growth Rate Q1/ Unemployment Rate (April)/ Participation Rate (April)/ Financial Stability Report

·       Euro Area Loans to Companies and Households (April)/ M3 Money Supply (April)

·       Italy GDP Growth Rate Q1/ Inflation Rate (May)/ PPI (April)

·       Poland Inflation Rate (May)

·       Slovenia Inflation Rate (May)

·       Greece PPI (April)/ Retail Sales (March)/ Unemployment Rate (April)/ Total Credit (April)

·       Ireland Construction Output Q1/ Inflation Rate (May)

·       Serbia Balance of Trade (April)/ Industrial Production (April)/ Retail Sales (April)/ Unemployment Rate Q1

·       Ukraine Current Account (April)

·       Russia M2 Money Supply (April)

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       South Africa M3 Money Supply (April)/ Private Sector Credit (April)/ Balance of Trade (April)/ Budget Balance (April)

·       Nigeria Foreign Exchange Reserves (May)

·       Kenya Inflation Rate (May)

Saturday, May 31, 2025

Global

·       Nothing significant to report.

Americas

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Asia

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       China NBS Manufacturing/ Non-Manufacturing/ General PMI (May)

Europe

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Poland Presidential Election - 2nd round

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Sunday, June 01, 2025 

Global

·       OPEC+ meeting takes place to review market conditions and oil prices.

·       Today is the first day of summer in the Northern Hemisphere.

Americas

Political/Social Events –

·       Mexico holds judicial elections. Voters for the first time will vote to elect all nine members of the Supreme Court, tow magistrates of the Superior Chamber of the Electoral Tribunal of the Federal Judiciary, 15 magistrates of the Regional Chambers of Electoral Tribunal, 5 members of the Judicial Disciplinary Tribunal, 464 circuit court magistrates, and 386 district court judges.   The vote comes after a highly controversial law was passed in 2024 by the Mexican parliament to move to judicial elections.  Critics argue the law politicizes the judicial system and opens the door to massive corruption and influence to the drug cartels.

Economic Reports/Events –

·       Nothing significant to report.

Asia

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       South Korea Imports/ Exports/ Balance of Trade (May)

Europe

Political/Social Events –

·       Poland holds the second round of presidential elections.

Economic Reports/Events –

·       Nothing significant to report.

Middle East

Political/Social Events –

·       Nothing significant to report.

Economic Reports/Events –

·       Nothing significant to report.

Africa

Political/Social Events –

·       Today is Madaraka Day, celebrating the Republic of Kenya and when it gained self-rule in 1963.

Economic Reports/Events –

·       Nothing significant to report.

Recommended Weekend Reads

What Is President Trump’s Golden Dome and Will It Work?  China’s Investments in EU and UK Rebounded in 2024,  Latin America’s Baby Bust is Coming Early, and Understanding the Two Chinas

Summer is just about here and we are hoping you are having a relaxing Memorial Day Weekend.  Below are our latest recommended reads.  We hope you have a wonderful Easter and a relaxing weekend.  And please let us know if you or someone you know wants to be added to our distribution list. 

President Trump’s Golden Dome

• The Golden Dome and the New Missile Age    Center for Strategic and International Studies Podcast

  President Donald Trump has proposed to create a multilayered defense system capable of intercepting missiles even if they are launched from the other side of the world and even if they are launched from space.  The concept includes both ground and space-based capabilities that would defend the US from attack by detecting and destroying them ahead of launch, intercepting them early in flight, halting them midcourse and stopping them in the last few moments of approaching a target. CSIS’s podcast takes a closer look at the President’s proposal and how it would be implemented, how much it will cost, and how it cannot work unless Canada is a part of it.

• Golden Dome for America: Revolutionizing U.S. Homeland Missile Defense   Lockheed Martin

  Defense contractor Lockheed Martin hopes to be the primary builder of President Trump’s Golden Dome missile defense system.  IN a recent post on their website, they offer an in-depth presentation of the multiple ways the Golden Dome, as they envision it, would be deployed in space, land, sea, and air.

• Bad News for Trump’s Golden Dome: He Can’t Build it without Canada  Politico

  President Donald Trump left out a key detail this week when he outlined his plans for a massive missile and air defense shield over the continent: He can’t build it without Canada. And it’s not clear America’s northern neighbor wants in.

• Can China’s New Stealth Tech Challenge Trump’s Golden Dome?     South Morning Chian Post

  Chinese scientists have unveiled a new material that could undermine the effectiveness of the new US missile defense system – known as the Golden Dome – proposed by President Donald Trump.  The material may be used as a stealth material that is effective against both infrared and microwave detection and could prove suitable for high-speed aircraft and missiles.

Asian-Pacific Economics

• There are Two Chinas, and America Must Understand Both    New York Times

  Two Chinas inhabit the American imagination: One is a technology and manufacturing superpower poised to lead the world. The other is an economy that’s on the verge of collapse.  Each reflects a real aspect of China.  resident Trump, as he tries to negotiate a resolution of a trade war, must reckon with both versions of America’s arch geopolitical rival. The stakes have never been higher to understand China. It’s not enough to fear its successes or take solace in its economic hardships. To know America’s biggest rival requires seeing how the two Chinas are able to coexist.

• A Geo-Economic Conundrum for the Member States of ASEAN    International Institute of Strategic Studies

  When leaders from Southeast Asia meet at a regional summit on 26–27 May in Kuala Lumpur, the sense of imminent crisis will have lifted, given the agreement announced by Beijing and Washington on 12 May to pause for 90 days their ongoing trade dispute. Yet anxiety will still be high. Another 90-day pause – on the ‘reciprocal tariff’ schedule announced by United States President Donald Trump in April – will expire on 8 July. All ten member states of the Association of Southeast Asian Nations (ASEAN) would face significant new tariffs under the schedule, with Cambodia, Laos, Thailand, and Vietnam being the hardest hit. Vietnam, facing a 46% tariff unless it reaches a bilateral deal with the US, might have the most to lose given its increasingly prominent position in supply chains serving the US market.

• Chinese Investment Rebounds Despite Growing Frictions    Mecator Institute for China Studies/Rhodium Group

  Chinese foreign direct investment (FDI) in the EU and UK rebounded last year for the first time since 2016: it reached EUR 10 billion, rising 47 percent from 2023.  Europe remained the leading destination for Chinese investment in high-income economies, drawing 53.2 percent of all Chinese FDI in such markets. In 2024, the EU and UK’s share of total Chinese FDI also rose to 19.1 percent, the first significant increase since 2018.  The growth of Chinese FDI in the EU and UK was driven by a slight recovery in mergers and acquisitions (M&A) activity and continued appetite for greenfield investment.  Greenfield investment increased for the third consecutive year, rising by 21 percent year-on-year and hitting a record high of EUR 5.9 billion.  2024, five investors—CATL, Tencent, Geely, Envision, and Gotion—accounted for almost half of the Chinese FDI in Europe.

Latin America

• When Recession is Not Mexico’s Biggest Problem     Americas Quarterly

  The “R” word is becoming increasingly popular in Mexico. On the same day that the U.S. reported a surprising quarterly GDP contraction in the first trimester of the year, data released by Mexico’s statistics institute, INEGI, showed an unexpected 0.2% quarterly economic expansion for the same period. Since this initial and seasonally adjusted reading followed a 0.6% decline in economic output in the last quarter of 2024, it appears Mexico barely escaped the curse of a so-called “technical recession” (i.e., two consecutive quarters posting negative changes).  This result, however, is unlikely to settle the issue, particularly in Mexico’s polarized political climate. It can be easily argued, for instance, that the positive reading is explained by an unusually strong 8.1% growth rate posted by the volatile primary sector. This serves as a good reminder that business cycles are a more complex affair than a simple rule of thumb would suggest. More importantly, a discussion about this issue should not be Mexico’s main priority.

• Latin America’s Baby Bust is Arriving Early     Bloomberg

  Data published in the past few weeks confirm the quick decline in the region’s fertility levels, with the number of births in Brazil falling to the lowest in close to 50 years. In Argentina, the number of newborns has almost halved in just a decade, with kindergartens struggling to find pupils. In 2024, Uruguay had more deaths than births for the fourth consecutive year. Even Bolivia, a country of traditionally large families, is about to fall below the 2.1 children-per-woman threshold necessary to keep its population constant.

•  The Spy Factory – Russian Intelligence’s Use of Brazil for Deep Cover Operations    New York Times

  For years, a New York Times investigation found, Russia used Brazil as a launchpad for its most elite intelligence officers, known as illegals. In an audacious and far-reaching operation, the spies shed their Russian pasts. They started businesses, made friends and had love affairs — events that, over many years, became the building blocks of entirely new identities.  Major Russian spy operations have been uncovered in the past, including in the United States in 2010. This was different. The goal was not to spy on Brazil, but to become Brazilian. Once cloaked in credible back stories, they would set off for the United States, Europe or the Middle East and begin working in earnest.  The Russians essentially turned Brazil into an assembly line for deep-cover operatives.

Geoeconomics

• Unconventional Monetary Policies in Small Open Economies   Jesper Lindé/Marcin Kolasa/Stefan Laseen IMF Working Papers

  This paper provides a comprehensive assessment of the macroeconomic and fiscal impact of unconventional monetary tools in small open economies. Using a DSGE model, we show that the exchange rate plays a critical role to amplify the favorable impact of unconventional monetary policy while it attenuates the effectiveness of conventional fiscal policy to jointly boost output and inflation. We then use the model as a laboratory to do a case study of the Swedish Riksbank asset purchases and negative policy rates 2015-2019. We find that the Riksbank unconventional policy measures provided meaningful macroeconomic stimulus to economic activity and inflation, with the dual benefit of reducing overall government debt by about 5 percent of GDP. If conventional fiscal policy had been used to provide a commensurate output boost, inflation would have risen notably less, and the fiscal cost would have amounted to a deterioration of the government debt position with nearly 8 percent of GDP.

• What Have We Learned from the U.S. Tariff Increases of 2018-19?     Reserve Bank of St. Louis “On the Economy” Blog

  In the summer of 2018, the normal pace of global trade encountered an important disruption: The United States increased tariffs to a wide set of imported goods from China, which included such diverse products as electronics, furniture, manufacturing equipment and aerospace components. In this way, the imposed tariffs impacted final consumption goods, intermediate inputs and capital goods used by U.S. households and firms.  All told, these measures affected approximately $376 billion of Chinese exports to the U.S., or around 50% of all the country’s imports from China. The scale becomes even more remarkable when one considers that prior to this campaign, most of these goods faced tariffs of just 3% to 4% and that China was the largest trading partner of the U.S. in terms of imports.

U.S. Financial Regulatory Week Ahead

Tax and Crypto Bills Moving Again, SEC Speaks 2025 Set to Showcase Atkins Agenda, and the CFTC Empties Out

May 19 - 23, 2025

We thought it would be a quiet(ish) week last week, so we took off for a little R&R.  Boy, were we wrong.  It was a jam-packed week in the Washington regulatory world and this coming week looks to be just as busy in advance of Memorial Day.

Looking at the major events this coming week, we are watching both the start-and-stop-and-start again motion of both the Reconciliation bill in the House of Representatives and the Crypto legislation in the Senate.  Both are – for now – moving forward again.   The Reconciliation bill, which has a number of important tax provisions for the financial sector (including a provision maintaining the tax-exempt status of credit unions as well as the preservation of carried interest and the creation of something called “MAGA Accounts” which allow opening $1,000 tax-advantaged investment accounts for every newborn baby with a Social Security number).   House Speaker Michael Johnson (R-LA) is hoping for a vote by the end of the week before Congress goes out for the Memorial Day recess next week, but it is going to be a very close vote.  And even if it passes, the Senate is likely to make a lot of changes to the bill.

The Senate is set to consider landmark cryptocurrency legislation this week.  A procedural vote is expected by Wednesday, with a likely final vote later in the week.  Senate Democrats, who blocked an earlier version of the bill, seem to be coming around to a new draft that was circulated last week. 

Also on the Hill this week, the House Financial Services Committee is holding a two-day legislative markup extravaganza.  By our count, more than 25 stand-alone pieces of legislation will be marked up and more than 25 amendments will also be debated and voted on.  See below for details of what Chair French Hill (R-AK) has teed up for the committee to consider.

Turning to the regulators, it seems as if the Commodities Futures Trading Commission (CFTC) is, well, emptying out. Rapidly. Acting CFTC Chair Caroline Pham said last week she is planning on stepping down once Brian Quintenz is confirmed as the new chair (there is no timeframe on when that will happen). Commissioner Christy Goldsmith Romero also announced she is leaving on May 31, as is Commissioner Summer Mersinger, who is set to become the new CEO of the Blockchain Association.  Her last day at the CFTIC is also May 31.  That means Acting Chair Phan will be the sole member of the Commission until Quintenz is confirmed.  And President Trump has not nominated anyone else to fill the other commission vacancies.

Over the Federal Reserve, Chair Jay Powell announced he is planning on a 10 percent cut to Fed staff, including through voluntary resignations, over the next several years.

There are a lot of Fed speeches this coming week, many taking place at the Atlanta Federal Reserve Bank’s Annual Financial Markets Conference.    For more details on the conference and everything else we are tracking this coming week, here is the full list of what is happening:

U.S. Congressional Hearings 

U.S. Senate

·       Thursday, May 22, 10:00 a.m. – The Senate Banking Committee holds a hearing entitled Securing America: Key Authorities Under the Defense Production Act.

House of Representatives

·       Tuesday, May 20, 10:00 a.m. – The House Financial Services Committee will hold a hearing entitled Day One: Markup of Various Measures - more than 25 pieces of legislation and more than 25 amendments to other pieces of legislation.

·       Tuesday, May 20, 10:00 a.m. – SEC Chair Paul Atkins will testify before the House Appropriations Committee.  The topic of the hearing is “Oversight Hearing of the U.S. Securities and Exchange Commission.”

·       Wednesday, May 21, 10:00 a.m. – the House Financial Services Committee will hold a hearing entitled Day Two: Markup of Various Measures – seeking to wrap up anything they did not finish yesterday.

Federal Department & Regulatory Agency Meetings &Events

Federal Reserve Board and Federal Reserve Banks

·       Sunday – Wednesday, May 18 – 21 – The Atlanta Federal Reserve Bank holds its annual Financial Markets Conference. This year’s theme is “Financial Intermediation in Transition: How Will Policy Adopt?”  A number of Federal Reserve senior staff and industry leaders will be speaking at the conference.

·       Monday, May 19, 7:45 a.m. – New York Federal Reserve Bank President John Williams speaks on the US economic outlook at the Mortgage Bankers Association Secondary and Capital Markets Conference in New York.

·       Monday, May 19, 7:30 a.m. – Atlanta Federal Reserve Bank President Raphael Bostic gives welcome remarks before the 2025 Financial Markets Conference -"Financial Intermediation In Transition: How Will Policy Adapt?" hosted by the Federal Reserve Bank of Atlanta.

·       Monday, May 19, 8:45 a.m. – Federal Reserve Board Vice Chair Phillip Jefferson speaks at the Federal Reserve Bank of Atlanta Financial Markets Conference in Fernandina Beach, Florida.

·       Monday, May 19, 12:30 p.m. Central Time – Dallas Federal Reserve Bank President Lorie Logan gives prepared remarks during “Policy Session 2: The Increasing Role of Nonbank Institutions in the Treasury and Money Markets" at the 2025 Financial Markets Conference -"Financial Intermediation In Transition: How Will Policy Adapt?" hosted by the Federal Reserve Bank of Atlanta.

·       Monday, May 19, 12:30 p.m. Central Time – Minneapolis Federal Reserve Bank President Neel Kashkari participates in a conversation before the Minnesota Young American Leaders Program (MYALP) at the University of Minnesota.

·       Tuesday, May 20, 8:00 a.m. – Richmond Federal Reserve Bank President Thomas Barkin speaks on growth in rural communities before the "Elevating What Works" 2025 Investing in Rural America Conference hosted by the Federal Reserve Bank of Richmond.

·       Tuesday, May 20, 8:00 a.m. Central Time – Atlanta Federal Reserve Bank President Raphael Bostic gives welcome back remarks before the 2025 Financial Markets Conference -"Financial Intermediation In Transition: How Will Policy Adapt?" hosted by the Federal Reserve Bank of Atlanta.

·       Tuesday, May 20, 12:00 p.m. Central Time – St. Louis Federal Reserve Bank President Alberto Musalem speaks on the U.S. economy and monetary policy in a moderated conversation before the Economic Club of Minnesota.

·       Tuesday, May 20, 5:00 p.m. – Federal Reserve Board Governor Adriana Kugler gives the commencement address at the Spring 2025 Berkeley Economics Commencement Ceremony (virtually).

·       Wednesday, May 22, 11:00 a.m. Central Time – Richmond Federal Reserve Bank President Thomas Barkin participates in a “Fed Listens" event as part of the “Elevating What Works" 2025 Investing in Rural America Conference hosted by the Federal Reserve Bank of Richmond.

·       Wednesday, May 22, 1:00 p.m. Central Time – New York Federal Reserve Bank President John Williams gives keynote before Monetary Policy Implementation Workshop: “Unwinding Large Central Bank Balance Sheets" hosted by the Federal Reserve Bank of New York.

·       Friday, May 23, 12:00 p.m. – Federal Reserve Board Governor Lisa Cook gives a speech on financial stability at the 7th Annual Women in Macro Conference, cosponsored by New York University's Graduate School of Arts and Science, New York University's Stern School of Business, and the University of Chicago's Becker Friedman Institute (Virtual).

·       Sunday, May 25, 2:40 p.m. – Federal Reserve Board Chair Jay Powell gives the commencement address at Princeton University.

U.S. Treasury Department

·       There are no significant events scheduled at this time.

Department of Commerce

·       There are no significant events scheduled at this time.

Department of Housing and Urban Development

·       There are no significant events scheduled at this time.

Small Business Administration

·       There are no significant events scheduled at this time.

Securities and Exchange Commission

·       Monday, May 19, 8:30 a.m. - The SEC Speaks in 2025 Conference is being held in Washington, D.C.  SEC Chair Paul Atkins will be speaking, as will SEC Commissioners Mark Uyeda, Hester Pierce, and Caroline Crenshaw.

·       Tuesday, May 20, 10:00 a.m. – SEC Chair Paul Atkins will testify before the House Appropriations Committee.  The topic of the hearing is “Oversight Hearing of the U.S. Securities and Exchange Commission.”

·       Wednesday, May 22, 2:00 p.m. – The SEC holds a Closed Meeting.

Commodities Futures Trading Commission

·       There are no significant events scheduled at this time.

Federal Deposit Insurance Corporation

·       Tuesday, May 20, 2:30 p.m. – The FDIC Board will hold an Open Session to discuss the Deposit Insurance Fund Restoration Plan Semiannual Update and vote on Rescission of the 2024 FDIC Statement of Policy on Bank Merger Transactions and Reinstatement of Prior FDIC Statement of Policy.

Office of the Comptroller of the Currency

·       There are no significant events scheduled at this time.

The Consumer Financial Protection Bureau

·       There are no significant events scheduled at this time.

FINRA

·       There are no significant events scheduled at this time.

National Credit Union Administration

·       Thursday, May 22, 10:00 a.m. – The NCUA’s Board will meet. The agenda includes a briefing of the Board on the Share Insurance Fund Quarterly Report and a board briefing on the NCUA’s Voluntary Separation Programs (Note: This was on the agenda for the since-canceled April Board meeting; an updated version of the VSP briefing will now occur.  Also note: Currently, the NCUA board consists solely of Chairman Kyle Hauptman. There are no other board members.)

Federal Trade Commission & Department of Justice Antitrust Division

·       There are no significant events scheduled at this time.

Farm Credit Administration

·       There are no significant events scheduled at this time.

Farm Credit Insurance Corporation

·       There are no significant events scheduled at this time.

International Monetary Fund & World Bank

·       There are no significant events scheduled at this time.

North American Securities Administrators Association

·       There are no significant events scheduled at this time.

Trade Associations & Think Tank Events

Trade Associations

·       Monday – Tuesday, May 19 – 20 – The National Association of Insurance and Financial Advisors (NAIFA) holds its Congressional Conference in Washington, D.C.

Think Tanks and Other Events

·       There are no significant events scheduled at this time.

Recommended Reading

• Banking Analytics: Understanding the Composition of Bank Loan Portfolios   Federal Reserve Bank of St. Louis

  In the fourth quarter of 2024, commercial real estate loans represented a quarter of U.S. banks’ loan portfolios. What other types of loans did these institutions hold?

• Banks Thrill to Potential Softening of Post-Crisis Capital Requirements   The Daily Upside*

  The Financial Times, citing multiple sources, reported last week that the US is poised to slash capital requirements imposed on banks in the wake of the 2008 crash. The banking industry, unsurprisingly, was already quite optimistic about a potential change.

• Household Debt and Credit Report ()Q1 2025)   Federal Reserve Bank of New York Center for Microeconomic Data

  Total household debt increased by $167 billion to reach $18.20 trillion in the first quarter, according to the latest Quarterly Report on Household Debt and Credit. Credit card balances fell by $29 billion from the previous quarter to stand at $1.18 trillion; auto loan balances declined by $13 billion to $1.64 trillion, marking only the second time balances have fallen from a prior quarter since 2011. Student loan balances grew by $16 billion to reach $1.63 trillion, and the data show a large uptick in the rate at which balances went from current to delinquent, due to the resumption of reporting student loans on credit reports after a nearly five-year pause. Mortgage balances increased by $199 billion to reach $12.80 trillion and HELOC balances rose by $6 billion to $402 billion. Aggregate delinquency rates rose from the previous quarter, with 4.3 percent of outstanding debt in some stage of delinquency. Transition into serious delinquency remained stable for auto loans, credit cards, and other debt.

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