International News 09 July 2025
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Asian Markets Stay Calm as Trump Delays Tariff Implementation to August
Asian stock markets remained relatively stable on Tuesday (July 8) despite U.S. President Donald Trump sending tariff warning letters to 14 major trade partners. Wall Street closed lower, but sentiment in Asia improved as Trump delayed the implementation of new tariffs until August 1, 2025. Japan’s Nikkei rebounded after Trump hinted the deadline was “firm but not absolute,” allowing space for negotiations. The U.S. dollar strengthened against the yen, and the Australian dollar rose ahead of the RBA’s expected rate cut. Markets are expected to face rising volatility as more tariff letters are issued and talks continue ahead of the August deadline.
China Expands Bond Connect Access to Boost Yuan Internationalization
China’s central bank, the People’s Bank of China (PBOC), announced plans to broaden domestic investor access to overseas bond markets through the southbound channel of the Bond Connect program. This move will now include non-bank institutions such as brokerages, insurers, mutual funds, and wealth managers, aiming to deepen financial market integration and promote the internationalization of the yuan. Speaking at the Bond Connect Anniversary Summit, PBOC official Huifen Jiang emphasized that both the southbound and northbound channels will be further enhanced to better serve cross-border investors. In addition, PBOC will increase the quota for Swap Connect, allowing foreign investors to trade onshore yuan-based interest rate swaps—part of efforts to stabilize the yuan amid rising U.S.-China trade tensions. Yi Zhang, president of China Foreign Exchange Trade System, highlighted China’s commitment to promoting yuan-denominated bonds globally, while Hong Kong Exchanges CEO Bonnie Chan stressed Hong Kong’s pivotal role in connecting global capital with Chinese opportunities. As of January 2025, Chinese investors held ¥561 billion (US$78.2 billion) in Hong Kong bonds—still modest compared to the city’s estimated US$1 trillion bond market.
China Warns U.S. Against Renewed Trade Tensions as August Tariff Deadline Looms
The Chinese government has warned U.S. President Donald Trump against reigniting trade tensions by reinstating high tariffs on Chinese goods starting August 1, 2025. Beijing also threatened retaliation against countries aligning with the U.S. to exclude China from global supply chains. The warning follows Trump’s move to send formal notices to key trading partners about upcoming tariffs. China has until August 12 to reach a deal with Washington to avoid the return of previous retaliatory tariffs. In an official editorial, the People’s Daily criticized Trump’s tariffs as “bullying” and stressed that dialogue and cooperation are the only viable paths forward.