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US auto sales expected to increase in the second quarter, but tariffs could drive up prices
U.S. autos sales are expected to increase in the second quarter, aided in part by a sustained demand for gasoline-powered vehicles. However, industry experts warn that tariffs imposed by President Donald Trump will likely drive up prices in the months ahead. Ford Motors, the first Detroit automaker that reported its results on Tuesday, saw sales rise 14.2% for the third quarter as Americans increased their purchases in anticipation of automotive tariffs. Peer Hyundai Motors' sales increased by 10% during the third quarter when compared with the same period in 2013. The market research firm Cox Automotive predicts that U.S. sales of new vehicles will increase by about 1.7% in the second quarter compared to a year earlier, to 4,18 million units. Chris Hopson is a principal analyst with S&P Global Mobility. He said that the potential for price increases will worsen the affordability of new vehicles in the second half. According to Cox, General Motors will likely hold the top spot for the quarter, followed closely by Toyota Motor North America and Ford. Tariffs initially boosted demand, but this boost will fade once higher prices become the norm. Charlie Chesbrough is a senior economist with Cox Automotive. He said that the consumer demand in the next few months will be lower because the demand for pull-ahead products has been satisfied. Cox expects EV automaker Tesla to report a drop of nearly 21% in the second quarter vehicle sales compared to last year. The tariffs are mainly aimed at lower-cost imported vehicles, like Ford's compact Maverick pick-up truck and GM’s affordable Chevrolet Trax cross-over. This will reduce affordability worries as the average price of a new vehicle approaches $50,000. (Reporting from Nathan Gomes, Bengaluru; additional reporting by Utkarsh shetti; editing by Alan Barona and Tasim Zahid).
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US construction spending drops again in May
The U.S. Construction spending dropped in May due to higher mortgage rates, and an increase in inventory. The Census Bureau of the Commerce Department reported on Tuesday that construction expenditures dropped by 0.3%, following a downwardly revised 0.2% drop in April. Economists surveyed by predicted that construction spending would decline 0.2%, following a 0.4% drop in April. In May, spending fell 3.5% compared to the same period last year. The amount spent on private construction projects fell by 0.5%. Residential construction investment also fell 0.5%. Outlays for new single-family housing projects dropped 1.8%. The Federal Reserve has paused its cycle of interest rate reductions because tariffs on imported products have increased economic uncertainty. The new housing inventory has reached levels not seen since late 2007. In a survey conducted by the National Association of Home Builders last month, sentiment among homebuilders of single-family homes plummeted in June to its lowest level in two and a half years. It predicted a drop in single-family home starts this year. In May, the expenditures on multi-family housing units remained unchanged. Investments in non-residential private structures such as offices and factories fell 0.4%. The spending on public construction projects increased by 0.1%. The spending on construction by state and local governments was flat, but federal government expenditures increased 1.0%. Lucia Mutikani, reporting; Paul Simao, editing.
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Spain bans concert ticket scalping and fuel advertising
The Spanish government unveiled on Tuesday a draft law aimed at encouraging sustainable consumption and reducing costs. It would prohibit practices like reselling concert ticket for profit, and advertising fossil fuels or cars powered by these. Reporters were told that the government's goal is to encourage industries' transition to more sustainable and accessible models. This will lower prices for consumers, and make significant progress in protecting the environment. The bill also prohibits "advertising that is based on fear of crime or natural catastrophes" and stops companies from making false claims or misleading statements about their environmental credentials. This practice, known as greenwashing, is illegal. The government is encouraging travellers to use the electric-powered train instead of most domestic flights. The bill must be approved by the parliament where the socialist government of Prime Minister Pedro Sanchez, who won a second term in an election in late 2023, is in a minority. The government has been unable to gain enough support from the lower house of parliament to pass several bills, and has yet to present a budget for both this year and next. Bustinduy is a member of the junior coalition partner Sumar from the extreme left. He has conducted campaigns against budget airlines, summer tourism rentals and other businesses, but with mixed results. Last week, a court suspended fines of over 179 million Euros ($211.13 Million) that his ministry had imposed on low-cost airlines for charging for cabin luggage. Some rental listings that his ministry ordered to be removed from platforms like Airbnb in May still appear on the internet.
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Spain and the World Bank launch a debt swap hub to free up development funds
The Spanish Ministry of Economy announced on Tuesday that the World Bank and Spain have partnered to help countries release money for sustainable development projects through debt swaps. Many countries spend more money on debt servicing than they do on development. As a result, many nations have to come up with creative solutions to fund projects. These can range from funding schools and water sanitation projects to protecting coral reefs. The Spanish government announced that the Global Hub for Debt Swaps for Development will be launched at the Finance for Development Summit in Seville (southern Spain) and provide countries with financial and technical assistance when they are looking to reallocate funds to projects such as food security and climate adaption. Over the past year, countries from Barbados to Ivory Coast used debt swap mechanisms to refinance more expensive bonds or loans at lower rates and pledged to use the savings to fund social and environmental projects. Critics say that such deals are time-consuming, expensive and difficult to replicate. This has prevented a wider adoption of an important tool, according to advocates, to help countries reduce their debt burdens and tackle development issues. Carlos Cuerpo, Minister of Economy, Trade, and Business in Spain, said: "We've heard the message loud and clear from many countries that we need practical tools to make debt swaps easier, faster, and accessible." The Hub will be supported by Spain with 3 million euros, and the World Bank will host an "multi-partner trust to finance technical assistance". Ajay Banaga, World Bank Group president, said: "By turning pilot projects into repeatable solution, we can reduce debt burdens and unlock investment in education, healthcare, and opportunities." In the past two decades, Spain signed 47 agreements, which resulted in the cancellation of 1,64 billion euro of debt. The Economy Ministry announced that the government has created a new framework for signing bilateral debt swaps totaling 300 million euro over the next five-year period.
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Andy Home: Copper's high tariffs fail to lift other LME Metals
Doctor Copper isn't the same as it was before Donald Trump, President of the United States, announced an investigation in February into U.S. imported products. Tariff trade has thrown the global supply chain into disarray, causing a feast in the U.S. but famine elsewhere. London Metal Exchange (LME), copper is expected to close the first half with a gain 12%. Only the wild tin markets will beat it. However, the rest of the LME is still reeling from Trump's "Liberation Day", broader tariffs. The precious metals have been boosted by geopolitical turmoil and trade, but the industrial metals are still largely in the same place at mid-year as concerns grow about the impact of tariffs on global manufacturing. The LME scorecard for the first half 2025. COPPER – FEAST AND FAMILY CME's U.S. Copper contract currently trades at a premium of $1200 per metric tonne over the LME international price. Tariff trade has been extremely volatile in the past few months. However, the arbitrage window is still sucking up metals from around the globe. CME stocks have exploded and LME stock are in decline as physical copper is being redirected into the U.S. LME spreads are becoming turbulent as inventory shrinks. Cash-to-three month period is in steep reverse. Market participants expect Chinese smelters will increase exports in order to fill supply-chain holes, but the London Copper market remains a hazardous place for bears until this happens. The U.S. government will decide whether or not to impose import tariffs. This is a sign of more turmoil ahead of the deadline in November for the Section 232 investigations into U.S. imported goods to be completed. WILD TIN London's tin market is a roller coaster so far this season. Early April, three-month tin reached a high of $38,395 a ton. After the metals meltdown on "Liberation Day", it fell to $28,925. Due to the persistent pressure on supply, tin is now back above $33,500 a ton. The Bisie mine, in the Democratic Republic of Congo was quickly reopened after a short disruption. However, the Man Maw Mine in Myanmar continues to be affected by a longer-term disruption. Wa State authorities, who control the Man Maw Mine, have been in negotiations to obtain new licenses that will allow it to be reopened after almost two years. The flow of tin to China's smelters is still a trickle. China's imports of tin-concentrate fell by 36.5% between January and May, and the country's metal smelters feel the pinch. According to Shanghai Metal Market, refinery production in June was down 15% year-over-year. Since the middle of April the Shanghai Futures Exchange tin stocks have been steadily declining, while the LME inventories have halved in the first half year. Tin is the only LME-listed metal, other than copper, that trades in a significant backwardation. This shows the supply pressures in the market. ALUMINIUM SPLIT Trump's import tariffs of 50% have fractured the aluminium market, but their impact is more visible in the premiums for the U.S. Midwest than the arbitrage between similar CME and LME contracts. The LME price is now around $1,250 higher than what U.S. customers pay for their metal. The premiums are falling everywhere else, partly because of displaced metal flows as well as weak demand in Europe and Asia. The recent London market action has largely been a massive tug-of war for the available metal, against a background of falling exchange stock. It's difficult to distinguish the signal from noise when using aluminium. The LME's three-month price rose from $2,335 to $2600 per ton in April, but the gain year-to date is only a modest 3.0%, falling short of analysts' expectations for the beginning of 2025. NICKEL WEIGHED BY SURPLUS WEIGHED DOWN LME Nickel also ends the first half 2025 with little change from its January start point. The LME Nickel Stocks fell in May, for the first since March 2024. This is a sign of a possible slowdown in the accumulation of inventory. How long it will last remains to be determined. Nickel's electric dream has faded, as Chinese electric vehicles manufacturers have switched to non-nickel batteries. Indonesia continues to increase production and generate more metal. Analysts at Macquarie Bank say that the price of LME nickel three-month is just above $15,000 per ton, which is about the same as the cost to refine nickel from Indonesian nickel-pig iron. While the price of nickel may not be as high as it is now, any recovery will depend on Indonesia's ability to curb its growing nickel production sector. No one is holding their breath. ZINC WINDS DROPPING, LEAD GEARS ON. Due to its close relationship with the automotive batteries sector, the lead market has been cushioned from the tariff turmoil of this year. Lead is currently entering its seasonal peak demand period, which occurs when temperatures in the northern hemisphere are high and cause an increase in battery failures. LME lead has risen 6% since the beginning of the year. It is now catching up with zinc, the LME metal that continues to be the underperformer. According to the International Lead and Zinc Study Group, world zinc mine production increased by 5.1% in January-April. This supply surge has led to an increase in refined production, especially in China. The Group estimates that the global refined metals market recorded a 151,000-ton surplus of supply in the period. You don't need to look any further to see why galvanising is in such disfavor. It has fallen by 6% since 2025. These are the opinions of the columnist, an author for.
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India launches antitrust investigation of Asian Paints following complaint by billionaire Birla
According to an order, India's antitrust agency ordered an investigation of Asian Paints on Tuesday after Aditya Birla Group paints venture claimed that the country’s top paint manufacturer abused its dominant position in the market. According to the order, Asian Paints' initial review by the Competition Commission of India (CCI), showed that it had violated competition laws. Birla claims that Asian Paints abused its dominant position on the market by offering incentives and discounts to dealers, such as travel abroad in exchange for exclusivity. Birla claimed that Asian Paints increased the sales targets for dealers dealing with Birla's products. Birla also claimed that Asian Paints "forced" transporters and landlords to avoid doing business with Birla. The CCI's first review found that Asian Paints had "imposed unfair conditions on them (dealers)," which was in the nature exploitative conduct, the watchdog stated. It ordered its investigation unit to investigate the matter. Birla Opus, the paints division of Aditya Birla Group, Grasim Industries is led by billionaire Kumar Mangalam Birla. According to Forbes, Kumar Mangalam Birla is India's seventh-richest person. Asian Paints has a market share of 52% in India. The company has lost some of its Dominance Elara Capital data show that Birla Opus, launched in February 2024, grew quickly to reach a market share of nearly 7% by March. Asian Paints has not responded to the request for comment regarding the CCI order. Aditya K. Kalra, New Delhi; Chris Thomas, Bengaluru. Editing by Shreya B. Biswas.
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IDB aims to unlock more than $11 billion for sustainability goals
The Inter-American Development Bank wants to unlock at least 11 billion dollars in sustainable financing to help countries deal with events such as natural disasters, which put pressure on their currencies and hinder private-sector investments. Multilateral lenders are being pressed to find innovative ways to address climate change, biodiversity loss and other challenges as the United States and richer nations reduce official development aid. Ilan Goldfajn, IDB president, said that the IDB's actions would inspire the private sector to contribute more - a priority of the conference. He said: "We are not just announcing new ideas, we're launching the things that private sector has been asking for - credible tools, scalable platform, and real investment opportunities with impact and confidence." Support will include a platform that helps countries manage the risks of large domestic currency swings, which can discourage international investors because it is harder to predict return. The plan is to extend the program to other regions in the next three-year period and double the amount of money raised. FX EDGE is a credit line that will kick in if the value of a currency drops sharply. This usually happens during political crises, debt crises, or natural disasters. It ensures debtors are able to continue making payments for their loans, whether they're made in dollars or another currency. The platform will also allow for greater use of currency hedge instruments, such as derivatives, through local financial institutions and banks. These instruments are backed up by the IDB credit rating. 'AMAZONIA BONDS' The IDB, in collaboration with the World Bank will also issue "Amazonia Bonds" worth up to $1 billion. These bonds were tested last year and helped to curb deforestation in the world's largest rainforest. Brazil, Colombia, and Peru all try to protect a rainforest area covering more than 6,000,000 square kilometres (2,3,000,000 square miles), which is home to 10% of the known species of animals and plants. Goldfajn added that the IDB will also increase the number countries who can access a newly enlarged emergency relief fund of $5 billion called the Contingent Credit Facility for Natural Disasters. It will offer, along with other multilateral development institutions, more "Climate-Resilient Debt clauses", which allow countries to suspend their loan payments for a maximum of two years in case a major hurricane or drought occurs, or if any other natural disaster occurs, scientists believe that climate change has made it more likely. IDB estimates that the clauses will cover $4.2 billion by 2026. A separate Business Resilience Program run by IDB Invest will include similar clauses in contracts with private companies. The Regional Disaster Risk Transfer Program was also established to enable countries to transfer risks associated with extreme weather events onto the capital and insurance markets. IDB Invest's Business Resilience program would include debt clauses in contracts with private companies as a way to cushion them against climate risks. Goldfajn stated that "each of these are important in their own right, but when taken together they demonstrate how development banks can move the needle through tailoring risk to investors." (Reporting from Simon Jessop in London, Marc Jones in Seville and Barbara Lewis in Matthew Lewis's and Matthew Lewis's offices)
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Investors wait for Trump's tax bill to see if it will affect the stock market and dollar.
The dollar fell to multi-year lows and global shares dropped on Tuesday. It had just finished its worst half-year performance since 1970, and was ahead of the vote on President Donald Trump’s tax-cutting and spending legislation. The previous day, optimism about trade helped global share markets reach an intraday high. The Senate debate over Trump's proposed bill, which is estimated to add $3.3 billion to the United States debt pile, weighed down on sentiment. The European share market, which had a gain of 6.5% on a year-to date basis at the end of June, was down by 0.4% for the day. The tax-cutting and spending bill was expected to be voted on during Tuesday's Asian trading session, but the debate continued over the long list of amendments proposed by Republicans and minority Democrats. Trump wants to pass the bill before the Independence Day holiday on July 4. Investors are also looking forward to Thursday's key U.S. employment data as global trade negotiators rush to reach agreements before Trump's deadlines. Ray Attrill is the head of FX Strategy at National Australia Bank. He said on NAB's The Morning Call Podcast that the payroll data due later this week would "have a significant impact, I believe, on the sentiment regarding the timing of Fed rate reductions". POLITICAL DRAMA Futures for the S&P 500 index and Nasdaq fell 0.2%, indicating a slight pullback in the opening of trading later. Tesla shares fell 5% or more in pre-market trade after Trump suggested that the government's efficiency department review the subsidies provided to CEO Elon Musk's companies. Musk criticised Trump's proposed budget and social media exchanges between the two began to devolve into personal attacks as of early June. This political drama, which could be a resurgence of the bear story just as shares are starting to recover, said Matt Britzman. Senior equity analyst at Hargreaves Lansdown. Tesla is still among the top 10 most valuable Wall Street companies, but its value has dropped by around a third since December, when it reached a record-high. Nvidia, another heavyweight, is also on its way to becoming the most valuable business in history. It's market capitalisation is approaching $4 trillion. In pre-market trading, the chipmaker's stock was down slightly. The Bank of Japan’s tankan business sentiment index and a Chinese measure of factory activity showed that the largest economies in the area were likely to weather the tariff storm at least for the moment. Japan's manufacturing sector also grew for the first time since more than a month, but a significant drop in demand underscored the difficult trade outlook for Asia’s export-dependent economies. The dollar was weaker against the Japanese currency dropping by 0.8% to 143yen. Its value against the Euro was also little changed at $1.18. This is its lowest level since September 2021. In the first half of this year, the U.S. dollar lost more than 10 percent of its value against six other currencies. This is the worst performance it has had in at least fifty years. Brent crude futures rose 0.7% to $67.22 a barrel on the same day, reversing a previous decline. This was due to expectations that OPEC+ would increase their output in August. Gold spot rose by nearly 1.5%, to $3352 per ounce.
Gold prices rise on weaker dollar, US tariffs and fiscal uncertainty
The gold price rose by over 1% Tuesday, as investors sought safe haven assets due to a weaker US dollar and concerns over the fiscal outlook of the United States.
As of 0824 GMT spot gold rose by 1.1% to $3,339.20 an ounce. U.S. futures gold increased by 1.3% to $3352.00. Gold prices fell for overseas buyers as the U.S. Dollar dropped to its lowest level in early 2022.
The precious metals' safe-haven appeal has been boosted by worries over the U.S. financial outlook and ongoing uncertainty related to tariffs, as the Trump Administration keeps all options open ahead of the looming deadline in July," said Ricardo Evangelista. Senior analyst at brokerage firm ActivTrades.
"I expect the prices to rise in the near-term, attracting more buying interest when they reach $3,350. The next significant resistance level is around $3,370." On Monday, President Donald Trump expressed his frustration over the U.S.-Japan negotiations. Treasury Secretary Scott Bessent warned countries that they could face a sharp increase in tariffs as a deadline of July 9 approaches.
The markets are also focusing on the vote for Trump's tax-cutting and spending bill. This adds to an already uncertain market climate.
Trump has continued to press the Federal Reserve for a rate cut. He sent Fed Chair Jerome Powell an international list of interest rates along with handwritten notes that suggested the U.S. should be between Japan's interest rate of 0.5% and Denmark interest rate of 1.75%.
Trump's tirade against Powell and the Fed has caused investor concerns about the central banks' credibility and independence.
The markets will be watching the ADP Employment Report on Wednesday, and the non-farm payrolls report on Thursday for any clues about the Fed's policy.
Gold tends to do well when interest rates are low and is seen as an investment that can be relied upon during economic uncertainties.
Silver spot rose 0.6%, to $36.30 an ounce. Platinum fell 1.3%, to $1334.67. Palladium rose 0.7%, to $1104.86. (Reporting and editing by Emelia Sithole Matarise in Bengaluru, Anushree mukherjee from Bengaluru)
(source: Reuters)