The US Federal Reserve is widely expected to lower its benchmark interest rate by a quarter percentage point, moving it to the 3.75%-4.00% range. The rate cut aims to address persistent job market concerns and maintain economic stability as hiring slows and inflation remains subdued.

Trade negotiations between the US and South Korea have hit a roadblock as US President Donald Trump demands a $350 billion investment from South Korea during the Asia-Pacific Economic Cooperation summit. South Korean officials are concerned that such a large cash investment could destabilize their economy and have proposed loans and loan guarantees instead.

US President Donald Trump is set to relaunch engagement with China, starting with a framework agreement reached by top trade negotiators during talks this past weekend. The agreement, which is expected to be finalized during a meeting Thursday between Trump and Chinese President Xi Jinping, is expected to include China resuming soybean purchases and delaying controls on rare-earth minerals in exchange for the US delaying new tariffs and possibly rolling back a 20% levy related to the fentanyl crisis.

Bond investors are divided on the long-term effects of artificial intelligence on interest rates, with some predicting higher rates due to increased economic growth and capital expenditure, while others expect deflationary effects from productivity gains. The timing and magnitude of AI's influence remain unclear, with factors like government debt and demographic shifts further complicating forecasts.

US Treasurys have seen a significant drop in volatility recently, but investors are eyeing US Federal Reserve Chair Jerome Powell's upcoming news conference for potential changes. With policymakers divided on interest rates amid a softening labor market and persistent inflation, any hawkish comments from Powell could push 10-year yields above 4%.

China's new five-year plan aims to significantly increase the household consumption rate, signaling a shift toward domestic demand as a key driver of economic growth. While the document does not specify how the rate will be measured, analysts suggest the government may introduce annual consumption growth targets when the plan is formally approved next year.

The Australian Securities and Investments Commission has updated guidance to classify stablecoins, wrapped tokens, tokenized securities and digital asset wallets as financial products. Companies offering these products must obtain a local financial services license. ASIC has granted sectorwide no-action relief through June 30, 2026, allowing businesses time to comply.

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This report analyzes interest rate derivatives (IRD) trading activity reported in Europe. The analysis is based on transactions publicly reported by 30 European approved publication arrangements (APAs) and trading venues (TVs). Click here to read the report.