Guardian Weekly Market Report – Issue 172

Reports of Note Due This Week

Key takeaways this week will be the Consumer Price Index and the Producer Price Index which will be released Wednesday and Thursday morning. Investors will be keeping an eye on tariffs as Trump’s deadline on trade deals approaches.

• Monday, June 9 – 10:00 A.M. Wholesale inventories.
• Tuesday June 10 – 6:00 A.M. NFIB optimism index.
• Wednesday June 11 – 8:30 A.M. Consumer price index (CPI), 2:00 P.M. monthly U.S. federal budget.
• Thursday June 12 – 8:30 A.M. the Weekly Initial Jobless Claims expected at 242,000 versus last weeks 247,000 and Producer price index (PPI).
• Friday June 13 – 10:00 A.M. Consumer sentiment (prelim)

Geopolitics

President Trump and Chinese President Xi Jinping held a 90-minute phone call Thursday, their first of Trump’s second term, focusing on trade amid renewed tensions. The call, requested by the U.S., follows Trump’s recent accusations that China violated the Geneva tariff agreement, which had lowered punitive tariffs on both sides. China denied the claim, urging the U.S. to lift “negative measures.” Despite a sharp drop in the U.S.-China trade deficit and reduced tariffs, no concrete trade deals have materialized, and critics argue Trump’s aggressive tariff strategy has disrupted global business without clear gains. Talks between senior envoys are now planned, and a potential in-person meeting is in the works. Meanwhile, Trump also faces challenges on TikTok’s U.S. ownership and Chinese-sourced fentanyl flows, with looming deadlines and unresolved issues adding to the diplomatic complexity.

Liberal lawyer Lee Jae-myung has been elected president of South Korea, winning 49.4% of the vote after a period of political upheaval triggered by former President Yoon Suk Yeol’s failed martial law declaration. In his inauguration, Lee pledged national unity, transparency, and a pragmatic, market-driven approach to governance. He vowed to strengthen ties with the U.S. and Japan, restore military credibility, and reengage North Korea through both dialogue and deterrence. His victory is widely attributed to public backlash against Yoon, who was impeached in December and now faces insurrection charges. Lee, who narrowly lost the 2022 election to Yoon, emphasized the urgency of reaching a trade deal with the Trump administration, particularly amid looming U.S. tariffs. While promising to protect Korea’s interests, he acknowledged Trump’s tough negotiating style, saying diplomacy must remain mutually beneficial and that Korea holds strategic leverage in ongoing talks.

Central banks are on pace to purchase around 1,000 metric tons of gold in 2025, marking the fourth consecutive year of elevated buying, according to Metals Focus. Despite gold prices surging 29% this year—driven by geopolitical tensions and economic uncertainty under President Trump’s tariff policies—central bank demand has remained strong. The move reflects ongoing efforts to diversify away from the U.S. dollar, fueled by concerns over Trump’s erratic policy approach, his criticism of Fed Chair Jerome Powell, and weakening confidence in U.S. Treasuries. China, Poland, and Azerbaijan led official purchases in Q1, with Iran also likely boosting reserves. While central bank demand stays robust, gold jewelry consumption is expected to fall 16% this year due to high prices, particularly in India and China. Metals Focus projects average gold prices will climb 35% in 2025, potentially rising further into 2026.