The US Senate moved ahead with efforts to pass its tax and spending legislation on Monday, considering amendments and procedural issues in a so-called "vote-a-rama." Meanwhile, the US House is getting ready to potentially vote on the measure as soon as Wednesday.
The European Union is reportedly open to a US trade deal involving a 10% universal tariff, but wants lower rates for key sectors such as pharmaceuticals, alcohol, semiconductors and commercial aircraft. The EU is also seeking quotas and exemptions to reduce the impact of US tariffs on automobiles, steel, and aluminum, sources say. The EU has until July 9 to reach an agreement with US President Donald Trump before tariffs on nearly all EU exports to the US increase to 50%.
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European Central Bank Governing Council member Gediminas Simkus says the inflation outlook is fragile because of volatility in the commodities and foreign exchange markets. While the ECB has met its inflation target, Simkus notes that the rapid strengthening of the euro and energy price fluctuations pose risks, with a greater chance of undershooting the 2% target.
Japan's latest 10-year government bond auction drew robust demand, with a bid-to-cover ratio of 3.51, exceeding the 12-month average. Attention now shifts to Japan's upcoming 30-year bond auction scheduled for Thursday, which is seen as a critical test of investor appetite for super-long maturities.
The US dollar index has dropped 10.8% in the first half of 2025, marking the worst performance for the period since 1973. Uncertainty surrounding US President Donald Trump's trade and tariff policies, as well as his push for US Federal Reserve rate cuts, have contributed to the decline.
China has raised the quota for the Qualified Domestic Institutional Investor program to $170.9 billion, marking the first increase since May 2024. The move is expected to ease capital outflow controls as depreciation pressure on the yuan has subsided and demand for foreign assets has decreased. The quota increase includes $2.1 billion for securities firms and fund houses, $660 million for banks and $300 million for insurers.
The European Union T+1 Industry Committee has urged financial firms to invest in automation to prepare for the transition to a one-day securities settlement regime in 2027, highlighting the need to eliminate manual processes to avoid bottlenecks. The shift, which will align the EU with the US, is expected to be more complex due to the fragmented nature of the European market.
This research note analyzes changes in interest rate derivatives (IRD) trading activity in the US, EU and UK from 2021 to 2024. It examines how central bank interest rate policies influenced IRD trading volumes and how the composition of IRD products has evolved due to the transition to alternative reference rates. Click here to read the report.
ISDA has published a new research paper that analyzes interest rate derivatives (IRD) trading activity reported in mainland China and Hong Kong. Click here to read the report.
