US-China Trade Deal Keeps Tariffs, Eases Rare Earths Trade; World Bank Cuts 2025 Global Growth Forecast
Key Takeaways
- US and China trade deal maintains tariffs; rare earth mineral trade eased.
- World Bank cuts 2025 global growth forecast to 2.3% amid trade tensions.
- JPMorgan CEO Dimon warns US economy risks decline amid Trump tariffs.
- ECB signals pause amid tariff uncertainty; US leaders criticize Fed.
- Gold overtakes euro as world's second-largest reserve asset in 2024.
Top Stories
US-China preliminary trade deal keeps tariffs; rare earths trade eased.
On June 11-12, 2025, the US and China reached a preliminary trade agreement maintaining US tariffs at 55% and China’s at 10%, easing rare earth mineral trade. The deal awaits approval from Presidents Trump and Xi, reflecting ongoing trade tensions in the world economy.
World Bank cuts 2025 global growth forecast to 2.3% amid trade tensions.
On June 10-11, 2025, the World Bank revised global growth down to 2.3% for 2025, the slowest since 2008, due to rising trade tensions and policy uncertainty affecting emerging economies including Mexico and the Middle East.
JPMorgan CEO warns US economy risks decline amid Trump tariffs.
On June 10-12, 2025, JPMorgan CEO Jamie Dimon cautioned that US economic indicators might worsen due to President Trump's tariffs and weakening consumer confidence. He noted tariffs could disrupt but not collapse the economy, highlighting risks to jobs and inflation.
US leaders criticize Fed; ECB signals pause amid tariff uncertainty.
On June 11-12, 2025, US Vice President J.D. Vance criticized the Federal Reserve for not cutting rates amid low inflation, while ECB policymaker Gediminas Simkus called for a pause in rate moves due to tariff policy uncertainty.
Gold overtakes euro as world's second-largest reserve asset in 2024.
In 2024-2025, gold's share of global reserves rose to 20%, surpassing the euro's 16%, driven by central bank purchases and geopolitical tensions including the Ukraine conflict.
Central Bank Actions
India updates economic data methods; RBI cuts rates to boost growth.
On June 11-12, 2025, India announced plans to revise key economic indicators and the RBI cut the repo rate by 50 basis points to 5.5%, aiming to boost consumption and investment amid 6.5% GDP growth and 3.16% retail inflation.
Financial Health
German GDP growth forecast raised to 0.3% in 2025 and 1.5% in 2026.
In June 2025, the Ifo Institute raised Germany's GDP growth forecast to 0.3% for 2025 and 1.5% for 2026, citing government tax relief and infrastructure spending despite export challenges and US tariff impacts.
June 2025 Euribor rates steady around 2.09%, impacting Spanish mortgages.
On June 12, 2025, the Euribor rate stood at 2.090%, with monthly averages near 2.065%, influencing variable mortgage rates for many Spanish families.
Market Overview
US Dollar index hits multi-year lows amid tariff fears and weak inflation.
On June 12, 2025, the US Dollar index fell to a three-year low due to tariff uncertainties and softer US inflation data, with the Dollar weakening against major currencies including the yen and euro. This decline increases expectations of Federal Reserve rate cuts, impacting global currency markets.
US stock indexes fall post US-China trade deal and inflation report.
On June 11-12, 2025, US stock indexes including the S&P 500 and Nasdaq declined slightly following a preliminary US-China trade agreement and lower-than-expected inflation data. The market showed initial recovery but closed lower amid ongoing trade and economic uncertainties.
Policy Watch
Kenya unveils 2025/26 budget targeting revenue growth without new taxes.
On June 12, 2025, Kenya's government announced its 2025/26 budget aiming to boost revenues and reduce fiscal deficit without new taxes, focusing on tax evasion control and infrastructure projects amid economic challenges.
China and ECB deepen cooperation on monetary system reforms.
On June 12, 2025, China's Premier Li Qiang met ECB President Christine Lagarde in Beijing to strengthen cooperation on international monetary system reforms and promote multilateral coordination.