As quiet as it gets
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What new tariff letters were issued and why are they considered low‑impact?
So more tariff letters today, but smaller economies and nothing too alarming. The ten year treasury auction went better than expected, although slightly less interest from overseas. The RBNZ on hold, of course. But what next? And a very divided Fed in the minutes had overnight. Some argue they are very close to the neutral rate already, so do they need to do anything else? So President Trump could be very disappointed. And a quiet session today will let you know what to expect. It's Thursday. Thursday is the tenth of july twenty twenty five. It's the morning call from Nav. Good morning. Well US equities are over the tariff news, it seems. Now they just want to focus on keeping going higher. So half a percent added to the Dow, the SP is up naught point six percent, not point nine percent added to the Nasdaq.
Nvidia hit a new record high today and for a while had a market cap over four trillion. The VIX incidentally down to sixteen. So really it doesn't seem as though anyone has any concerns about the uncertainty of a global trade war. In Europe as well, one point four percent added to the Eurostocks fifty, the DAX, and the CAT current, all up by the same amount, knock it not echoed in the UK, uh, where shares are up just naught point one percent. And bond yields falling today, down six basis points for ten year treasuries after the auction that we'll talk about. Uh, the same for Canada, not much happening for Europe though, down two basis points for German bunds, down one basis point for ten year guilt yields in the UK, and that is pretty.
Much the picture across all of Europe, just one or two basis points in it. And oil today, uh well, it's up a bit, but not a lot, 0.1% for WTI and Brent. Brent at 6720 a barrel now. So it's all a bit lackluster and humdrum, but uh let's see what's beneath it all. Here's Nab's Taylor Newton in Melbourne. So, first of all, uh new letters have arrived, but the markets don't seem interested. I mean it's the Philippines. Brunei, Moldova, Algeria, Libya, Iraq and Sri Lanka. Not massive economies.
How did the 10‑year Treasury auction perform and what did it mean for yields?
And actually it I think it's just they were just saying you've got a baseline ten percent tariff, really. There's nothing uh nothing astonishing or alarming uh and hence not much reaction.
Yeah, good good morning, Phil. I think I think that's right. I think, you know, we've we've learnt that the the letters are are not necessarily something to respond to. You know, effectively what we've seen is that extension of the July nine deadline to the the first of August. Um the Wall Street Journal is reporting that that extension um got up on on advice from Besson and other advisors that there were some deals that were close by um and the letters there are just kind of, you know, a a scheme to to keep negotiating pressure up even if you know in effect it is just a a a kick further down the road of that that july ninth date to the first. As you say, kind of the new batch of letters, you know, no kind of you know first order or or top uh US trading partners.
And again, similarly the the rates that are contained in those letters are are similar to what was announced on April two. And again some of those ones at the higher end kind of forty plus percent RF seem to be moderated a little bit. I think they're you know, no surprising then given what I've just said that that equity markets were were pretty uninterested in the the new letters. But what's more interesting I think is the letters that we haven't seen. We haven't seen one go out for for India, the EU and Taiwan, for example. So that's, you know, something to to continue to watch. Yeah. We heard from the EU trade uh chief He was telling EU lawmakers that the two sides had had made good progress um on the text of a a joint statement.
So, you know, there's you know still potentially some optimism that um an EU deal could uh you know achieve that kind of ten percent baseline tariff rather than a a more elevated rate. Um but it's also the case I think that's worth calling out that the the boundaries of the tariff discussion they're they're still still a moving
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Chapters
8 chapters
1
What new tariff letters were issued and why are they considered low‑impact?
0:01–1:52
2
How did the 10‑year Treasury auction perform and what did it mean for yields?
1:52–4:36
3
What did the Fed minutes reveal about the divide over future rate moves?
4:36–7:28
4
Which countries received the latest tariff letters and what are the implications?
7:28–9:07
5
How are US jobless claims trending and what could they signal for the labor market?
9:07–11:14
6
What actions did the RBNZ take and what are the expectations for future cuts?
11:14–13:03
7
Why is China’s PPI falling and how might it affect global commodity prices?
13:03–14:54
8
What upcoming data releases and ECB commentary should listeners watch for next week?
14:54–15:06