TL;DR

China tightens mineral exports; EU accepts 15% U.S. tariff; OPEC+ output hike pushes oil lower.

Highlights

• China tightens export controls on rare earths, antimony, and other minerals, disrupting Western defense supply chains and raising input prices1.
• China’s copper smelters prepare to cut output due to ore shortages, compounding global metals supply concerns10.
• China ends the decades-long bond interest tax exemption, introducing VAT on bond interest and prompting portfolio reassessment4.
• EU agrees to a 15% tariff on most exports to the U.S. and commits to $750B in U.S. energy purchases, averting a larger trade war but weighing on EU growth5.
• U.S. imposes 25% tariffs on Indian exports and pressures India to curb Russian oil imports; India resists, and Goldman Sachs cuts India's growth forecast9.
• Trump administration imposes a 50% tariff on Brazilian coffee; China approves 183 Brazilian coffee exporters, offering Brazil an alternative market16.
• China rejects U.S. demands to halt Russian and Iranian oil imports, risking further U.S. tariffs and escalating trade tensions17.
• OPEC+ raises September crude output by 547,000 bpd; Brent drops below $70, and Goldman Sachs maintains a $56/bbl 2026 forecast7.
• BP announces its largest oil discovery in 25 years off Brazil, lifting shares and potentially impacting regional supply11.
• German Q2 GDP contracts 0.1%, with engineering orders down 5%, reinforcing recession concerns in Europe12.
• Bank of England expected to cut rates to 4% amid internal splits; guidance remains uncertain13.
• Asian equities decline and JGBs rally after weak U.S. payrolls boost Fed rate cut expectations; dollar softens, yen strengthens15.
• SEC launches “Project Crypto,” overhauling U.S. digital asset rules to permit token sales and DeFi, aiming to attract investment20.

Commentary

China’s export curbs on key minerals1 and looming copper output cuts10 are tightening the global supply of industrial inputs, immediately impacting Western defense and manufacturing sectors. These moves are driving up input costs and forcing companies to seek alternative sources, while also highlighting the West’s dependence on Chinese supply chains110. The introduction of VAT on Chinese bond interest adds further complexity for domestic investors, potentially raising funding costs and affecting appetite for sovereign and policy-bank debt4.

Trade friction remains a central theme. The EU’s acceptance of a 15% tariff on U.S. exports averts a more severe trade conflict but is expected to weigh on European growth, especially for export-driven industries5. The bloc’s commitment to large-scale U.S. energy purchases further deepens its reliance on American markets5. Meanwhile, the U.S. is escalating tariffs on both India and Brazil, targeting manufactured goods and coffee, respectively916. India’s refusal to cut Russian oil imports and China’s rejection of similar U.S. demands signal persistent energy trade realignment and the likelihood of further secondary sanctions, with implications for oil flows and emerging market currencies917.

In commodities, OPEC+’s output increase has pressured oil prices, with Brent slipping below $70/bbl7. BP ’s major Brazilian oil discovery could eventually shift regional supply dynamics, but near-term sentiment remains bearish on oil due to oversupply risks and rising inventories711. For metals, the combination of Chinese supply constraints and global demand uncertainty is likely to keep volatility elevated110.

Macro data and policy signals are shaping risk appetite. Weak U.S. jobs data have intensified expectations for a Fed rate cut as soon as September, driving a rally in sovereign bonds and weighing on Asian equities15. The Bank of England is expected to cut rates this week, but internal divisions and persistent inflation make the path of further easing unclear13. Germany’s ongoing contraction and falling industrial orders reinforce recession fears in Europe, likely keeping the euro and regional equities under pressure12.

The SEC’s overhaul of U.S. crypto regulation provides long-awaited clarity for digital assets, potentially attracting capital and fostering innovation in the sector20. Traders should monitor upcoming central bank meetings, evolving trade negotiations, and commodity supply developments for further direction.