Global News Summary 9-13 June 2025

Written By Larry Lim

Global markets were rocked by a dramatic escalation in the Middle East as Israel struck Iranian nuclear sites, prompting a massive missile retaliation from Tehran, triggering a sharp selloff in equities and a 7.5% surge in oil prices. Meanwhile, the U.S. and China agreed to resume trade cooperation amid Trump’s tariff hikes and demands for a 100bps Fed rate cut. UK GDP shrank 0.3% in April with rising unemployment, while Japan and Spain flagged slowing growth. Inflation risks returned just as global central banks were turning dovish, with rate-cut bets repriced lower. On the AI front, Meta invested $14.3B in Scale AI, OpenAI hit $10B revenue, and Apple opened its models to developers—highlighting an accelerating tech arms race despite geopolitical chaos.

United States

  • Tariffs & Trade: Trump raised steel and aluminium tariffs to 50%, with estimated import costs rising $100bn, intensifying global trade tensions. A U.S.–China framework deal was agreed in London (11 June) to restart a truce and address rare earths and tech.

  • Politics & Fed: Trump called Powell and demanded a 100bps rate cut, threatening to “force something”. Fed remained cautious ahead of a key policy meeting.

  • Middle East: Trump warned Iran after Israel struck nuclear targets (13 June); Iran retaliated (14 June), launching hundreds of missiles. S&P 500 fell –1.1% on 14 June, and WTI crude spiked +7.5% to $73.17.

  • Vaccine Panel Overhaul: All 17 members of a key U.S. vaccine advisory committee were dismissed in a shock restructuring.

United Kingdom

  • GDP: Contracted –0.3% in April, as higher taxes and Trump’s trade war weighed on exports and services.

  • Labour Market: Unemployment rose to 4.6%, with a 55k drop in payrolls. OBR warned Reeves may need to raise taxes again despite steep local levy hikes.

  • Housing Policy: Reeves planning a £25bn “housing bank” via a reformed Homes England to provide cheaper finance.

  • Tech Diplomacy: PM Starmer appeared with Nvidia CEO Jensen Huang to promote UK AI development.

Euro Area

  • ECB Policy: Schnabel said the rate-cutting cycle may be over, with 2026–27 inflation at 1.9%, “right on target.”

  • France: Macron hinted at possible snap elections amid domestic political challenges.

  • Germany: New home prices hit record highs, exacerbating housing stress.

  • Ireland: Fiscal council warned of outsized risks from US-led global trade war.

  • Spain: 2025 GDP forecast lowered to 2.4% (from 2.7%). Q2 GDP expected at 0.5%–0.6%, signalling early signs of slowing growth.

Japan

  • GDP: Contracted –0.2% annualised in Q1, under pressure from trade disruptions.

  • BOJ: May slow bond purchase tapering. Ueda said rate headroom is limited, but hikes possible if price trends improve.

  • Markets: Stocks rose on US jobs data and yen weakness. 40Y JGB demand softened.

China

  • Trade: Exports to U.S. –34% YoY in May, reflecting tariff pain.

  • Negotiations: Xi–Trump call led to resumed trade talks in London; rare earths export acceleration was a key topic.

New Zealand

  • Growth Outlook: RBNZ Chief Economist expects recovery in H2 2025, despite near-term inflation bumps.

  • Inflation: Core inflation easing; headline inflation expected to converge to 2% in 2026.

Australia

  • Consumer Sentiment: Rose 0.5% to 92.6 in June amid conflicting signals: low rates vs. weak growth.

  • Trade: Still engaged in talks with US and EU on beef and tariffs, with no breakthrough yet.

Economic Growth

  • UK GDP: –0.3% MoM (April)

  • Japan Q1 GDP: –0.2% annualised

  • Spain 2025 GDP cut to 2.4%, Q2 pace seen at 0.5–0.6%

  • RBNZ sees growth recovery in H2 2025

  • China Exports –34% YoY to US in May, weighing on growth

  • Australia GDP growth expected to stay soft amid trade uncertainties

Jobs & Labour Market

  • USA May NFP: +139K jobs, April revised to +147K (–95K total revision); unemployment steady at 4.2%

  • UK Unemployment: Rose to 4.6%, payrolls fell by 55k

  • Cooling job data in US and UK reflects the toll of rising trade barriers and tightening financial conditions

Debt Securities

  • USA 10Y Treasury: Rose to 4.41% on 14 June (+5 bps), as safe-haven behaviour broke amid inflation fears

  • UK Gilt 10Y: +7 bps to 4.55%

  • Germany Bund 10Y: +6 bps to 2.54%

  • Market pressure suggests re-pricing of geopolitical risk and rate outlook

Inflation

  • Oil prices surged +7.5% in one day (14 June), reviving inflation fears

  • Barclays warned of a “hawkish Fed surprise” in upcoming dot plot

  • RBNZ expects NZ inflation to return to 2% by 2026

  • ECB projects 1.9% inflation in 2026–2027, suggesting price stability

Recession Signals

  • Rising jobless data (UK), GDP contraction (Japan, UK), and collapsing exports (China) indicate slowdown risk

  • Fund outflows (US equity funds –$9.8B in one week) suggest investor de-risking

  • Iran–Israel conflict raises threat of stagflation via oil shock

Artificial Intelligence

  • OpenAI: Annual recurring revenue surged to $10B, driven by ChatGPT demand

  • Apple: Opening AI models to developers for ecosystem advantage

  • Meta: Invested $14.3B in Scale AI; hired its CEO to lead Meta AI

  • Mistral AI: Won contracts worth hundreds of millions; targeting $1B raise

  • Microsoft: Introducing AI safety rankings for cloud models

ESG

  • No major ESG updates this week, but:

    • UK’s £25bn affordable housing initiative may include sustainability-linked features

    • Geopolitical instability (Iran–Israel) puts pressure on ESG-aligned energy diversification efforts

Larry Lim
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Global News Summary 2-6 June 2025