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Volkswagen AG cut its 2025 earnings forecast after US import tariffs imposed under President Donald Trump’s administration added €1.3 billion ($1.53 billion) in costs during the first half of the year. The German carmaker now expects an operating return on sales of 4–5 per cent, down from a previously projected range of 5.5–6.5 per cent, amid rising trade tensions, internal restructuring, and weaker performance at its premium brands Audi and Porsche. Net profit for the second quarter fell by nearly a third year-on-year to €2.29 billion ($2.69 billion), while operating profit dropped 29 per cent to €3.83 billion ($4.49 billion). Despite delivering slightly more vehicles than the previous year, revenue declined 3 per cent to €80.6 billion ($94.59 billion).<h2>Tariffs and restructuring take a toll</h2>The sharp reduction in earnings was primarily attributed to the 25 per cent US tariff on European car imports, implemented in April, which continues to impact profitability, especially for Audi and Porsche, which rely heavily on US sales. Volkswagen warned that if the 27.5 per cent tariff persists into the second half, its performance could remain at the lower end of its forecast ranges. A reduction to 10 per cent could offer partial relief.Beyond the tariff pressure, Volkswagen is dealing with the consequences of a major internal overhaul. The group plans to cut over 35,000 jobs globally by 2030 in an effort to reduce costs and shift focus toward electric vehicles (EVs) and software-based mobility. The company also cited weaker margins from increased EV sales. While EVs are central to Volkswagen’s long-term strategy, the transition is proving costly in the short term. The group is also seeing declining demand in China, its largest market, where domestic brands are gaining ground.<h2>Electric vehicles and partnerships offer hope</h2>Amid the broader struggles, EV sales in Europe offered a rare bright spot. Volkswagen reported a 73 per cent jump in electric vehicle deliveries across the region in Q2, boosted by rising demand for models such as the VW ID.5, Audi Q4 e-tron, and Skoda Enyaq. Rebates and a consumer shift away from Tesla, reportedly due to CEO Elon Musk’s political activity, helped fuel the gains.Volkswagen is also banking on future partnerships to turn the tide. Collaborations with US-based Rivian and China’s Xpeng are expected to yield new models by next year, potentially improving competitiveness in both markets. However, uncertainty remains high. The company flagged global geopolitical tensions, inflation, protectionism, and volatile commodity and energy prices as key risks. The outlook for global automotive sales in 2025 is mixed, with Volkswagen expecting flat vehicle deliveries compared to 2024.<h2>Lower cash flow, flat sales forecast</h2>Volkswagen now expects flat revenue for 2025, down from an earlier estimate of 5 per cent growth. Free cash flow is forecast between €1 billion ($1.17 billion) and €3 billion ($3.52 billion), with capital investment remaining high as the company restructures. Net liquidity in the Automotive Division is expected to range between €31 billion ($36.38 billion) and €33 billion ($38.73 billion).Despite the challenges, Volkswagen said it would maintain a strong liquidity position and continue lobbying for a reduction in US trade barriers. The company warned that further political developments in the US, Middle East, and Eastern Europe could continue to disrupt the global automotive market.&nbsp;(With inputs from agencies)

The sharp reduction in Volkswagen's earnings was primarily attributed to the 25 per cent US tariff on European car imports, implemented in April, which continues to impact profitability, especially for Audi and Porsche, which rely heavily on US sales.

Volkswagen AG cut its 2025 earnings forecast after US import tariffs imposed under President Donald Trump’s administration added €1.3 billion ($1.53 billion) in costs during the first half of the year. The German carmaker now expects an operating return on sales of 4–5 per cent, down from a previously projected range of 5.5–6.5 per cent, amid rising trade tensions, internal restructuring, and weaker performance at its premium brands Audi and Porsche. Net profit for the second quarter fell by nearly a third year-on-year to €2.29 billion ($2.69 billion), while operating profit dropped 29 per cent to €3.83 billion ($4.49 billion). Despite delivering slightly more vehicles than the previous year, revenue declined 3 per cent to €80.6 billion ($94.59 billion). Tariffs and restructuring take a toll The sharp reduction in earnings was primarily attributed to the 25 per cent US tariff on European car imports, implemented in April, which continues to impact profitability, especially for Audi and Porsche, which rely heavily on US sales. Volkswagen warned that if the 27.5 per cent tariff persists into the second half, its performance could remain at the lower end of its forecast ranges. A reduction to 10 per cent could offer partial relief. Beyond the tariff pressure, Volkswagen is dealing with the consequences of a major internal overhaul. The group plans to cut over 35,000 jobs globally by 2030 in an effort to reduce costs and shift focus toward electric vehicles (EVs) and software-based mobility. The company also cited weaker margins from increased EV sales. While EVs are central to Volkswagen’s long-term strategy, the transition is proving costly in the short term. The group is also seeing declining demand in China, its largest market, where domestic brands are gaining ground. Electric vehicles and partnerships offer hope Amid the broader struggles, EV sales in Europe offered a rare bright spot. Volkswagen reported a 73 per cent jump in electric vehicle deliveries across the region in Q2, boosted by rising demand for models such as the VW ID.5, Audi Q4 e-tron, and Skoda Enyaq. Rebates and a consumer shift away from Tesla, reportedly due to CEO Elon Musk’s political activity, helped fuel the gains. Volkswagen is also banking on future partnerships to turn the tide. Collaborations with US-based Rivian and China’s Xpeng are expected to yield new models by next year, potentially improving competitiveness in both markets. However, uncertainty remains high. The company flagged global geopolitical tensions, inflation, protectionism, and volatile commodity and energy prices as key risks. The outlook for global automotive sales in 2025 is mixed, with Volkswagen expecting flat vehicle deliveries compared to 2024. Lower cash flow, flat sales forecast Volkswagen now expects flat revenue for 2025, down from an earlier estimate of 5 per cent growth. Free cash flow is forecast between €1 billion ($1.17 billion) and €3 billion ($3.52 billion), with capital investment remaining high as the company restructures. Net liquidity in the Automotive Division is expected to range between €31 billion ($36.38 billion) and €33 billion ($38.73 billion). Despite the challenges, Volkswagen said it would maintain a strong liquidity position and continue lobbying for a reduction in US trade barriers. The company warned that further political developments in the US, Middle East, and Eastern Europe could continue to disrupt the global automotive market. (With inputs from agencies)

The sharp reduction in Volkswagen's earnings was primarily attributed to the 25 per cent US tariff on European car imports, implemented in April, which continues to impact profitability, especially for Audi and Porsche, which rely heavily on US sales.

Volkswagen slashes outlook as US tariffs add $1.5 billion in costs

Amazon is facing mounting legal pressure in the UK, as a London tribunal ruled that two multi-billion-pound lawsuits accusing the e-commerce giant of abusing its market dominance can proceed. The cases, brought separately by third-party retailers and consumers, could cost the company up to £4 billion ($5.4 billion) if successful. Despite the legal setback, Amazon’s stock rose nearly 2 per cent on July 24, as investors appeared to shrug off the litigation threat, at least for now.<h2>Retailers target ‘Buy Box’ algorithm</h2>One of the lawsuits, valued at up to £2.7 billion ($3.64 billion), is led by competition law academic Andreas Stephan on behalf of more than 200,000 third-party retailers. The case centres around Amazon’s alleged manipulation of its “Buy Box” feature, the prominent “Add to cart” and “Buy now” section on product pages.Stephan’s legal team argues that Amazon gives preferential treatment to products using its own logistics and delivery services, disadvantaging sellers who rely on alternative fulfilment options. Since up to 80 per cent of purchases on Amazon are made via the Buy Box, winning that spot can make or break a seller’s sales performance. Amazon defends the feature, stating it helps customers compare options quickly based on price, condition, and shipping speed.<h2>Consumers claim suppressed competition</h2>In a separate case worth up to £1.3 billion ($1.75 billion), consumer advocate Robert Hammond is representing 49.4 million UK shoppers. His suit accuses Amazon of manipulating how products are presented to users in order to favour its own listings, reducing visibility for independent competitors and thereby distorting fair market access.Both lawsuits were certified by the UK’s Competition Appeal Tribunal on an opt-out basis, meaning affected retailers and consumers will automatically be included in the proceedings unless they choose otherwise.<h2>Amazon dismisses lawsuits as baseless</h2>Amazon has rejected the allegations, calling the claims “without merit.” A company spokesperson told Reuters, “We’re confident that will become clear through the legal process. Amazon has always focused on supporting the 100,000 businesses that sell their products on our UK store.” The lawsuits come amid growing regulatory scrutiny of US tech giants across the UK and Europe, as lawmakers intensify their efforts to rein in dominant digital platforms.

The cases, brought separately by third-party retailers and consumers, could cost Amazon up to £4 billion if successful. Despite the legal setback, Amazon’s stock rose nearly 2 per cent on July 24, as investors appeared to shrug off the litigation threat, at least for now.

Amazon is facing mounting legal pressure in the UK, as a London tribunal ruled that two multi-billion-pound lawsuits accusing the e-commerce giant of abusing its market dominance can proceed. The cases, brought separately by third-party retailers and consumers, could cost the company up to £4 billion ($5.4 billion) if successful. Despite the legal setback, Amazon’s stock rose nearly 2 per cent on July 24, as investors appeared to shrug off the litigation threat, at least for now. Retailers target ‘Buy Box’ algorithm One of the lawsuits, valued at up to £2.7 billion ($3.64 billion), is led by competition law academic Andreas Stephan on behalf of more than 200,000 third-party retailers. The case centres around Amazon’s alleged manipulation of its “Buy Box” feature, the prominent “Add to cart” and “Buy now” section on product pages. Stephan’s legal team argues that Amazon gives preferential treatment to products using its own logistics and delivery services, disadvantaging sellers who rely on alternative fulfilment options. Since up to 80 per cent of purchases on Amazon are made via the Buy Box, winning that spot can make or break a seller’s sales performance. Amazon defends the feature, stating it helps customers compare options quickly based on price, condition, and shipping speed. Consumers claim suppressed competition In a separate case worth up to £1.3 billion ($1.75 billion), consumer advocate Robert Hammond is representing 49.4 million UK shoppers. His suit accuses Amazon of manipulating how products are presented to users in order to favour its own listings, reducing visibility for independent competitors and thereby distorting fair market access. Both lawsuits were certified by the UK’s Competition Appeal Tribunal on an opt-out basis, meaning affected retailers and consumers will automatically be included in the proceedings unless they choose otherwise. Amazon dismisses lawsuits as baseless Amazon has rejected the allegations, calling the claims “without merit.” A company spokesperson told Reuters, “We’re confident that will become clear through the legal process. Amazon has always focused on supporting the 100,000 businesses that sell their products on our UK store.” The lawsuits come amid growing regulatory scrutiny of US tech giants across the UK and Europe, as lawmakers intensify their efforts to rein in dominant digital platforms.

The cases, brought separately by third-party retailers and consumers, could cost Amazon up to £4 billion if successful. Despite the legal setback, Amazon’s stock rose nearly 2 per cent on July 24, as investors appeared to shrug off the litigation threat, at least for now.

Amazon faces $5.4 billion UK lawsuits over alleged market abuse

In an extraordinary show of public pressure, President Donald Trump visited the Federal Reserve’s headquarters on July 24 to tour its ongoing renovation and to directly confront Chair Jerome Powell over monetary policy and construction cost overruns. While reiterating his demand for steep interest rate cuts, Trump also dialed back recent threats to fire Powell, whom he has repeatedly criticised. The visit marks only the fourth time a sitting president has visited the Fed since its founding in 1913, and the first in modern history to coincide with overt calls to change monetary policy.<h2>Trump demands aggressive rate cuts</h2>Standing beside Powell in white hard hats amid the construction zone, Trump renewed his call for the Fed to slash interest rates by at least three percentage points. “I’d love him to lower interest rates,” Trump said. “It would save our country hundreds of billions of dollars.” Trump’s visit comes ahead of next week’s Federal Open Market Committee meeting, where officials are widely expected to keep the benchmark rate steady at 4.25-4.50 per cent. Markets anticipate a possible cut in September.Powell, nominated by Trump in 2017, has maintained that decisions are guided by data and the Fed’s dual mandate of price stability and full employment. While Trump has repeatedly branded him a “numbskull” and “Too Late,” Powell has so far avoided responding.<h2>Sparring over renovation costs</h2>The president also took aim at the Fed’s $2.5 billion renovation of two historic buildings. Trump claimed the cost had ballooned to $3.1 billion and handed Powell a paper with what he called updated estimates. Powell corrected him, noting that the figure included an entirely separate building renovated five years earlier. “That’s a third building,” Powell said, shaking his head. “It was built five years ago.”Fed staff later clarified that rising costs were partly due to blast-resistant windows, tariffs, and inflation in labour and materials. Trump joked that on his own projects, a cost overrun of that size would “get someone fired.” But he also stated, “I don’t want to be personal,” adding, “I just would like to see it get finished.”<h2>Backs off firing threat, but keeps up pressure</h2>Despite previous suggestions that Powell should resign or be removed, Trump struck a more conciliatory tone this time. “To do that is a big move, and I just don’t think it’s necessary,” he said. “I believe he’s going to do the right thing.” Trump’s Truth Social post later that day was similarly mixed. He called the renovation “a disaster” but said, “Our country is doing very well and can afford just about anything—even the cost of this building!”The visit comes as Trump faces political heat over unrelated matters, including controversy over undisclosed files tied to Jeffrey Epstein. Still, the Fed episode is part of a broader strategy: pressure Powell to cut rates.&nbsp;(With inputs from agencies)

The visit comes as Donald Trump faces political heat over unrelated matters, including controversy over undisclosed files tied to Jeffrey Epstein. Still, the Fed episode is part of a broader strategy: pressure Jerome Powell to cut rates.

In an extraordinary show of public pressure, President Donald Trump visited the Federal Reserve’s headquarters on July 24 to tour its ongoing renovation and to directly confront Chair Jerome Powell over monetary policy and construction cost overruns. While reiterating his demand for steep interest rate cuts, Trump also dialed back recent threats to fire Powell, whom he has repeatedly criticised. The visit marks only the fourth time a sitting president has visited the Fed since its founding in 1913, and the first in modern history to coincide with overt calls to change monetary policy. Trump demands aggressive rate cuts Standing beside Powell in white hard hats amid the construction zone, Trump renewed his call for the Fed to slash interest rates by at least three percentage points. “I’d love him to lower interest rates,” Trump said. “It would save our country hundreds of billions of dollars.” Trump’s visit comes ahead of next week’s Federal Open Market Committee meeting, where officials are widely expected to keep the benchmark rate steady at 4.25-4.50 per cent. Markets anticipate a possible cut in September. Powell, nominated by Trump in 2017, has maintained that decisions are guided by data and the Fed’s dual mandate of price stability and full employment. While Trump has repeatedly branded him a “numbskull” and “Too Late,” Powell has so far avoided responding. Sparring over renovation costs The president also took aim at the Fed’s $2.5 billion renovation of two historic buildings. Trump claimed the cost had ballooned to $3.1 billion and handed Powell a paper with what he called updated estimates. Powell corrected him, noting that the figure included an entirely separate building renovated five years earlier. “That’s a third building,” Powell said, shaking his head. “It was built five years ago.” Fed staff later clarified that rising costs were partly due to blast-resistant windows, tariffs, and inflation in labour and materials. Trump joked that on his own projects, a cost overrun of that size would “get someone fired.” But he also stated, “I don’t want to be personal,” adding, “I just would like to see it get finished.” Backs off firing threat, but keeps up pressure Despite previous suggestions that Powell should resign or be removed, Trump struck a more conciliatory tone this time. “To do that is a big move, and I just don’t think it’s necessary,” he said. “I believe he’s going to do the right thing.” Trump’s Truth Social post later that day was similarly mixed. He called the renovation “a disaster” but said, “Our country is doing very well and can afford just about anything—even the cost of this building!” The visit comes as Trump faces political heat over unrelated matters, including controversy over undisclosed files tied to Jeffrey Epstein. Still, the Fed episode is part of a broader strategy: pressure Powell to cut rates. (With inputs from agencies)

The visit comes as Donald Trump faces political heat over unrelated matters, including controversy over undisclosed files tied to Jeffrey Epstein. Still, the Fed episode is part of a broader strategy: pressure Jerome Powell to cut rates.

Trump pressures Powell at rare Fed visit, backs off firing threat

A landmark US-Japan trade agreement touted by President Donald Trump has stirred a mix of optimism and confusion, as Japan pledges to establish a massive $550 billion investment fund targeting American industries. Despite its scale, questions abound over how the fund will be structured, financed, and implemented, leaving markets and analysts uncertain about its real impact. President Trump hailed the agreement as “the largest trade deal in history,” with the White House claiming that the US will control the fund’s direction and receive 90 per cent of its profits. Japanese officials, however, have offered a more cautious explanation, describing the pledge as a mix of investments, loans, and guarantees capped at $550 billion, not necessarily new capital.<h2>Fund lacks clarity, faces implementation hurdles</h2>Japan’s chief negotiator, Ryosei Akazawa, confirmed the fund would be supported by state-owned agencies like the Japan Bank for International Cooperation (JBIC) and Nippon Export and Investment Insurance, along with the private sector. Yet, with JBIC investing only $1.8 billion in North America in FY24, it’s unclear how these institutions could fund such an enormous commitment alone.Commerce Secretary Howard Lutnick suggested that Japanese firms will finance US-based infrastructure and industrial projects, with the profits split predominantly in favour of US taxpayers. But legal and operational details remain murky. Critics argue the proposal resembles a campaign promise more than a credible economic agreement. Some analysts also question whether previously announced investments from firms like SoftBank and Nippon Steel will be retroactively counted toward the deal.<h2>BOJ sees room to raise rates</h2>Despite these uncertainties, the deal has lifted a key cloud over Japan’s economic outlook, prompting speculation that the Bank of Japan (BOJ) may resume interest rate hikes later this year. Deputy Governor Shinichi Uchida signalled a more upbeat tone, citing improved chances of hitting the 2 per cent inflation target and rising price pressures from food costs.The BOJ is expected to maintain current rates at its July 30-31 meeting but could hint at a policy shift in the coming months. A revised inflation forecast and softened language around downside risks could pave the way for a potential rate hike as early as October. Still, the central bank remains cautious. The first-quarter GDP contraction, persistent consumer weakness, and the long-term impact of new US tariffs continue to weigh on policy deliberations.As markets await further guidance from BOJ Governor Kazuo Ueda next week, the success of the US-Japan trade deal and its true economic impact will depend heavily on whether its bold promises translate into tangible investment.&nbsp;(With inputs from agencies)

Critics argue that the US-Japan trade deal proposal resembles a campaign promise more than a credible economic agreement. Some analysts also question whether previously announced investments from firms like SoftBank and Nippon Steel will be retroactively counted toward the deal.

A landmark US-Japan trade agreement touted by President Donald Trump has stirred a mix of optimism and confusion, as Japan pledges to establish a massive $550 billion investment fund targeting American industries. Despite its scale, questions abound over how the fund will be structured, financed, and implemented, leaving markets and analysts uncertain about its real impact. President Trump hailed the agreement as “the largest trade deal in history,” with the White House claiming that the US will control the fund’s direction and receive 90 per cent of its profits. Japanese officials, however, have offered a more cautious explanation, describing the pledge as a mix of investments, loans, and guarantees capped at $550 billion, not necessarily new capital. Fund lacks clarity, faces implementation hurdles Japan’s chief negotiator, Ryosei Akazawa, confirmed the fund would be supported by state-owned agencies like the Japan Bank for International Cooperation (JBIC) and Nippon Export and Investment Insurance, along with the private sector. Yet, with JBIC investing only $1.8 billion in North America in FY24, it’s unclear how these institutions could fund such an enormous commitment alone. Commerce Secretary Howard Lutnick suggested that Japanese firms will finance US-based infrastructure and industrial projects, with the profits split predominantly in favour of US taxpayers. But legal and operational details remain murky. Critics argue the proposal resembles a campaign promise more than a credible economic agreement. Some analysts also question whether previously announced investments from firms like SoftBank and Nippon Steel will be retroactively counted toward the deal. BOJ sees room to raise rates Despite these uncertainties, the deal has lifted a key cloud over Japan’s economic outlook, prompting speculation that the Bank of Japan (BOJ) may resume interest rate hikes later this year. Deputy Governor Shinichi Uchida signalled a more upbeat tone, citing improved chances of hitting the 2 per cent inflation target and rising price pressures from food costs. The BOJ is expected to maintain current rates at its July 30-31 meeting but could hint at a policy shift in the coming months. A revised inflation forecast and softened language around downside risks could pave the way for a potential rate hike as early as October. Still, the central bank remains cautious. The first-quarter GDP contraction, persistent consumer weakness, and the long-term impact of new US tariffs continue to weigh on policy deliberations. As markets await further guidance from BOJ Governor Kazuo Ueda next week, the success of the US-Japan trade deal and its true economic impact will depend heavily on whether its bold promises translate into tangible investment. (With inputs from agencies)

Critics argue that the US-Japan trade deal proposal resembles a campaign promise more than a credible economic agreement. Some analysts also question whether previously announced investments from firms like SoftBank and Nippon Steel will be retroactively counted toward the deal.

Japan’s $550 billion US trade fund faces scrutiny amid unclear details

Samsung Electronics is accelerating its push into artificial intelligence (AI), with plans to expand beyond Google’s Gemini model in its upcoming Galaxy smartphones. The South Korean tech giant is in advanced talks with multiple AI firms, including OpenAI and Perplexity AI, to bring more generative capabilities to its next flagship lineup, the Galaxy S26, expected in 2025. According to Choi Won-Joon, president and chief operating officer of Samsung’s mobile division, the goal is to offer users more AI-powered choices rather than relying solely on Alphabet’s ecosystem.“We are talking to multiple vendors,” Choi said in a recent interview at Samsung’s Suwon headquarters. “As long as these AI agents are competitive and can provide the best user experiences, we are open to any AI agent out there.” Samsung is reportedly close to finalising an investment deal with Perplexity AI, which would see the company’s app and AI assistant embedded in future Galaxy devices. The strategy mirrors a broader industry trend, as smartphone makers like Apple and Samsung increasingly tap external developers to complement their in-house AI efforts.<h2>Chips and choices</h2>AI isn’t the only area where Samsung is diversifying. The company is currently evaluating chipsets for the Galaxy S26 series and may opt for its proprietary Exynos 2600 processor alongside, or instead of, Qualcomm’s latest Snapdragon chips. The recently launched Galaxy Z Flip 7 marked a milestone for Samsung, being the first foldable device powered by Exynos. With that launch, Samsung signalled a growing intent to reduce dependence on Qualcomm while addressing past concerns around the thermal and energy efficiency of its own chips.<h2>Foldable phones poised for breakout year</h2>On the hardware front, Samsung continues to bet heavily on foldables. The company has led the category with devices like the Galaxy Z Fold and Z Flip but now faces new competition. Apple is expected to enter the foldable market next year with its first folding iPhone, reportedly using OLED displays sourced from Samsung Display.“This is just the beginning of making these phones go mainstream,” said Choi, adding that Apple’s arrival would be “beneficial for the industry” by accelerating innovation and consumer adoption. With a sharpened focus on AI, in-house components, and form factor innovation, Samsung is positioning itself for a transformative year in mobile tech.&nbsp;(With inputs from agencies)

The South Korean tech giant, Samsung, is in advanced talks with multiple AI firms, including OpenAI and Perplexity AI, to bring more generative capabilities to its next flagship lineup, the Galaxy S26, expected in 2025.

Samsung Electronics is accelerating its push into artificial intelligence (AI), with plans to expand beyond Google’s Gemini model in its upcoming Galaxy smartphones. The South Korean tech giant is in advanced talks with multiple AI firms, including OpenAI and Perplexity AI, to bring more generative capabilities to its next flagship lineup, the Galaxy S26, expected in 2025. According to Choi Won-Joon, president and chief operating officer of Samsung’s mobile division, the goal is to offer users more AI-powered choices rather than relying solely on Alphabet’s ecosystem. “We are talking to multiple vendors,” Choi said in a recent interview at Samsung’s Suwon headquarters. “As long as these AI agents are competitive and can provide the best user experiences, we are open to any AI agent out there.” Samsung is reportedly close to finalising an investment deal with Perplexity AI, which would see the company’s app and AI assistant embedded in future Galaxy devices. The strategy mirrors a broader industry trend, as smartphone makers like Apple and Samsung increasingly tap external developers to complement their in-house AI efforts. Chips and choices AI isn’t the only area where Samsung is diversifying. The company is currently evaluating chipsets for the Galaxy S26 series and may opt for its proprietary Exynos 2600 processor alongside, or instead of, Qualcomm’s latest Snapdragon chips. The recently launched Galaxy Z Flip 7 marked a milestone for Samsung, being the first foldable device powered by Exynos. With that launch, Samsung signalled a growing intent to reduce dependence on Qualcomm while addressing past concerns around the thermal and energy efficiency of its own chips. Foldable phones poised for breakout year On the hardware front, Samsung continues to bet heavily on foldables. The company has led the category with devices like the Galaxy Z Fold and Z Flip but now faces new competition. Apple is expected to enter the foldable market next year with its first folding iPhone, reportedly using OLED displays sourced from Samsung Display. “This is just the beginning of making these phones go mainstream,” said Choi, adding that Apple’s arrival would be “beneficial for the industry” by accelerating innovation and consumer adoption. With a sharpened focus on AI, in-house components, and form factor innovation, Samsung is positioning itself for a transformative year in mobile tech. (With inputs from agencies)

The South Korean tech giant, Samsung, is in advanced talks with multiple AI firms, including OpenAI and Perplexity AI, to bring more generative capabilities to its next flagship lineup, the Galaxy S26, expected in 2025.

Samsung eyes AI expansion beyond Google Gemini for next-gen Galaxy devices

The US Federal Communications Commission (FCC) on July 24 approved the $8.4 billion merger between Paramount Global and Skydance Media, ending a prolonged review marked by political friction and allegations of press suppression. The 2-1 vote clears the way for David Ellison, son of Oracle co-founder Larry Ellison, to take control of legacy media brands including CBS, Paramount Pictures, and Nickelodeon. The deal, announced in mid-2024, was positioned as a strategic response to Paramount’s financial challenges in the evolving media landscape. Paramount+ has grown to 79 million subscribers, but the company has struggled with steep revenue declines, particularly in advertising. Skydance has committed to invest $1.5 billion into Paramount and aims to slash $2 billion in costs as part of the consolidation.<h2>Settlement with Trump fuels allegations of political pressure</h2>Paramount’s $16 million settlement with Donald Trump over CBS’s editing of a 2020 “60 Minutes” interview with then–Vice President Kamala Harris has drawn sharp criticism. The timing—just weeks before the merger approval—led some lawmakers and industry observers to call it a “bribe” to secure regulatory support.FCC Chairman Brendan Carr, a Trump appointee, insisted the settlement was unrelated to the commission’s decision. However, Democratic commissioner Anna Gomez dissented, calling Paramount’s actions a “cowardly capitulation” that undermined journalistic independence. Democratic Senators Elizabeth Warren and Edward Markey also voiced concerns, with Warren questioning the recent cancellation of The Late Show with Stephen Colbert, who had publicly criticised the settlement.<h2>CBS faces editorial uncertainty under new leadership</h2>As part of its commitments, Skydance has agreed to avoid diversity, equity, and inclusion (DEI) programs and to appoint an ombudsman to monitor claims of editorial bias at CBS. Carr hailed the move as restoring public trust, saying Skydance’s ownership could “usher in fair, unbiased, and fact-based coverage.”Still, CBS News employees and press advocates fear increasing editorial interference. The departure of executives who opposed the Trump settlement and the swift cancellation of Colbert’s show have heightened anxiety within the newsroom.Shari Redstone, Paramount’s current chair, will exit the board following the merger. Her departure marks the end of an era for the Redstone family, whose media empire began with drive-in theatres and peaked with control over some of the most iconic US broadcast and film properties.&nbsp;(With inputs from agencies)

The Paramount-Skydance merger deal, announced in mid-2024, was positioned as a strategic response to Paramount’s financial challenges in the evolving media landscape. 

The US Federal Communications Commission (FCC) on July 24 approved the $8.4 billion merger between Paramount Global and Skydance Media, ending a prolonged review marked by political friction and allegations of press suppression. The 2-1 vote clears the way for David Ellison, son of Oracle co-founder Larry Ellison, to take control of legacy media brands including CBS, Paramount Pictures, and Nickelodeon. The deal, announced in mid-2024, was positioned as a strategic response to Paramount’s financial challenges in the evolving media landscape. Paramount+ has grown to 79 million subscribers, but the company has struggled with steep revenue declines, particularly in advertising. Skydance has committed to invest $1.5 billion into Paramount and aims to slash $2 billion in costs as part of the consolidation. Settlement with Trump fuels allegations of political pressure Paramount’s $16 million settlement with Donald Trump over CBS’s editing of a 2020 “60 Minutes” interview with then–Vice President Kamala Harris has drawn sharp criticism. The timing—just weeks before the merger approval—led some lawmakers and industry observers to call it a “bribe” to secure regulatory support. FCC Chairman Brendan Carr, a Trump appointee, insisted the settlement was unrelated to the commission’s decision. However, Democratic commissioner Anna Gomez dissented, calling Paramount’s actions a “cowardly capitulation” that undermined journalistic independence. Democratic Senators Elizabeth Warren and Edward Markey also voiced concerns, with Warren questioning the recent cancellation of The Late Show with Stephen Colbert, who had publicly criticised the settlement. CBS faces editorial uncertainty under new leadership As part of its commitments, Skydance has agreed to avoid diversity, equity, and inclusion (DEI) programs and to appoint an ombudsman to monitor claims of editorial bias at CBS. Carr hailed the move as restoring public trust, saying Skydance’s ownership could “usher in fair, unbiased, and fact-based coverage.” Still, CBS News employees and press advocates fear increasing editorial interference. The departure of executives who opposed the Trump settlement and the swift cancellation of Colbert’s show have heightened anxiety within the newsroom. Shari Redstone, Paramount’s current chair, will exit the board following the merger. Her departure marks the end of an era for the Redstone family, whose media empire began with drive-in theatres and peaked with control over some of the most iconic US broadcast and film properties. (With inputs from agencies)

The Paramount-Skydance merger deal, announced in mid-2024, was positioned as a strategic response to Paramount’s financial challenges in the evolving media landscape.&nbsp;

FCC approves controversial $8.4 billion Paramount-Skydance merger

The European Central Bank (ECB) left its key interest rates unchanged on July 24, halting a year-long monetary easing campaign in the face of stabilising inflation and mounting global trade uncertainty. The deposit facility rate remains at 2.00 per cent, the main refinancing operations rate at 2.15 per cent, and the marginal lending facility at 2.40 per cent. Inflation has now returned to the ECB’s medium-term target of 2 per cent, allowing policymakers to pause and assess incoming economic data before taking further action.&nbsp;ECB President Christine Lagarde described the eurozone economy as being in a “good place,” with growth slightly better than expected and domestic price pressures easing as wage growth moderates. Lagarde emphasised a cautious, data-driven approach going forward, saying the ECB is “in a wait-and-watch situation” and would not pre-commit to a particular path for rates. The Governing Council reiterated its meeting-by-meeting stance and signalled no urgency to act, even as investors had earlier priced in at least one more rate cut later this year.<h2>Trade uncertainty clouds outlook</h2>The decision comes as the EU scrambles to secure a trade agreement with the United States before a potential tariff hike. The risk of a 15 per cent baseline tariff on EU goods looms large, with diplomats warning that failure to reach a deal could trigger retaliatory measures and a fresh shock to eurozone exports, investment, and household sentiment.Lagarde acknowledged that trade disputes are a major source of uncertainty. “The sooner this trade uncertainty is resolved, the less uncertainty we will have to deal with,” she said. A 15 per cent tariff would land between the ECB’s baseline and worst-case projections from June, both of which anticipated inflation dipping below 2 per cent in the medium term.&nbsp;Despite the risks, the eurozone economy has shown resilience. Recent PMI data indicated improving business activity, especially in the services sector, while manufacturing is gradually recovering. Lending activity has also picked up, and inflationary pressures remain contained, at least for now.<h2>Markets scale back rate cut expectations</h2>Lagarde’s upbeat tone and confirmation that projections are largely on track led markets to reduce bets on further rate cuts in 2024. Some economists now see the ECB holding rates steady through next year unless economic conditions deteriorate sharply.&nbsp;Still, with growth risks tilted to the downside, the ECB is keeping all options open. Some analysts believe a rate cut could still come in September if trade tensions escalate or if data significantly undershoots expectations. Others even warn that a return to rate hikes could come into play if inflationary pressures rebound.&nbsp;(With inputs from agencies)

Inflation has now returned to the ECB’s medium-term target of 2 per cent, allowing policymakers to pause and assess incoming economic data before taking further action.

The European Central Bank (ECB) left its key interest rates unchanged on July 24, halting a year-long monetary easing campaign in the face of stabilising inflation and mounting global trade uncertainty. The deposit facility rate remains at 2.00 per cent, the main refinancing operations rate at 2.15 per cent, and the marginal lending facility at 2.40 per cent. Inflation has now returned to the ECB’s medium-term target of 2 per cent, allowing policymakers to pause and assess incoming economic data before taking further action. ECB President Christine Lagarde described the eurozone economy as being in a “good place,” with growth slightly better than expected and domestic price pressures easing as wage growth moderates. Lagarde emphasised a cautious, data-driven approach going forward, saying the ECB is “in a wait-and-watch situation” and would not pre-commit to a particular path for rates. The Governing Council reiterated its meeting-by-meeting stance and signalled no urgency to act, even as investors had earlier priced in at least one more rate cut later this year. Trade uncertainty clouds outlook The decision comes as the EU scrambles to secure a trade agreement with the United States before a potential tariff hike. The risk of a 15 per cent baseline tariff on EU goods looms large, with diplomats warning that failure to reach a deal could trigger retaliatory measures and a fresh shock to eurozone exports, investment, and household sentiment. Lagarde acknowledged that trade disputes are a major source of uncertainty. “The sooner this trade uncertainty is resolved, the less uncertainty we will have to deal with,” she said. A 15 per cent tariff would land between the ECB’s baseline and worst-case projections from June, both of which anticipated inflation dipping below 2 per cent in the medium term. Despite the risks, the eurozone economy has shown resilience. Recent PMI data indicated improving business activity, especially in the services sector, while manufacturing is gradually recovering. Lending activity has also picked up, and inflationary pressures remain contained, at least for now. Markets scale back rate cut expectations Lagarde’s upbeat tone and confirmation that projections are largely on track led markets to reduce bets on further rate cuts in 2024. Some economists now see the ECB holding rates steady through next year unless economic conditions deteriorate sharply. Still, with growth risks tilted to the downside, the ECB is keeping all options open. Some analysts believe a rate cut could still come in September if trade tensions escalate or if data significantly undershoots expectations. Others even warn that a return to rate hikes could come into play if inflationary pressures rebound. (With inputs from agencies)

Inflation has now returned to the ECB’s medium-term target of 2 per cent, allowing policymakers to pause and assess incoming economic data before taking further action.

ECB holds interest rates steady amid trade tensions

The euro zone’s economic engine is starting to hum again, albeit cautiously. In July, business activity across the 20-member bloc accelerated to its fastest pace in nearly a year, driven by a stronger services sector and tentative signs of life in manufacturing. According to flash survey data published by S&amp;P Global and Hamburg Commercial Bank (HCOB), the region’s composite Purchasing Managers’ Index (PMI) rose to 51.0, an 11-month high, up from 50.6 in June. The reading beat Reuters’ poll forecast of 50.8 and marked a second straight month of growth.<h2>Services sector leads the recovery</h2>The July rebound was primarily powered by the services sector. The services PMI rose to 51.2, from 50.5 in June, surpassing analyst expectations of 50.7. “The euro zone economy appears to be gradually regaining momentum,” said Cyrus de la Rubia, Chief Economist at HCOB, in remarks quoted by Reuters. “The recession in the manufacturing sector is coming to an end, and growth in the services sector accelerated slightly in July.”&nbsp;The composite new business index, a proxy for demand, climbed to 50.0, its highest in over a year, indicating stabilisation after months of contraction.<h2>Factories still in contraction, but improving</h2>While still below the growth threshold, manufacturing activity showed tentative recovery. The manufacturing PMI improved to 49.8 in July from 49.5 in June, slightly better than expected.&nbsp;However, factory output edged down to 50.7 from 50.8, and the increase in activity was largely due to the completion of backlogged orders. The backlogs of work index rose to 49.0 from 47.1, its best level in nearly three years, indicating that the drag on manufacturing may be easing.<h2>Inflation pressures ease across services</h2>Input costs in the services sector cooled sharply. The services input price index fell to 56.7, a nine-month low, down from 58.1, while output prices also declined, signalling reduced inflationary pressures.&nbsp;This comes as the euro zone’s headline inflation held at 2.0 per cent in June, as per official data, meeting the European Central Bank’s (ECB) target.<h2>ECB decision looms as rate cut hopes build</h2>The ECB is expected to hold interest rates steady at its July 25 meeting, according to all 84 economists surveyed by Reuters. However, a slight majority anticipate another rate cut later this year, most likely in September, if inflation continues to soften and growth remains fragile.&nbsp;(With inputs from agencies)

Manufacturing PMI improved slightly to 49.8, indicating an end to recession signs. Inflation pressures eased, and the ECB may maintain interest rates, with potential cuts anticipated if trends persist.

The euro zone’s economic engine is starting to hum again, albeit cautiously. In July, business activity across the 20-member bloc accelerated to its fastest pace in nearly a year, driven by a stronger services sector and tentative signs of life in manufacturing. According to flash survey data published by S&P Global and Hamburg Commercial Bank (HCOB), the region’s composite Purchasing Managers’ Index (PMI) rose to 51.0, an 11-month high, up from 50.6 in June. The reading beat Reuters’ poll forecast of 50.8 and marked a second straight month of growth. Services sector leads the recovery The July rebound was primarily powered by the services sector. The services PMI rose to 51.2, from 50.5 in June, surpassing analyst expectations of 50.7. “The euro zone economy appears to be gradually regaining momentum,” said Cyrus de la Rubia, Chief Economist at HCOB, in remarks quoted by Reuters. “The recession in the manufacturing sector is coming to an end, and growth in the services sector accelerated slightly in July.” The composite new business index, a proxy for demand, climbed to 50.0, its highest in over a year, indicating stabilisation after months of contraction. Factories still in contraction, but improving While still below the growth threshold, manufacturing activity showed tentative recovery. The manufacturing PMI improved to 49.8 in July from 49.5 in June, slightly better than expected. However, factory output edged down to 50.7 from 50.8, and the increase in activity was largely due to the completion of backlogged orders. The backlogs of work index rose to 49.0 from 47.1, its best level in nearly three years, indicating that the drag on manufacturing may be easing. Inflation pressures ease across services Input costs in the services sector cooled sharply. The services input price index fell to 56.7, a nine-month low, down from 58.1, while output prices also declined, signalling reduced inflationary pressures. This comes as the euro zone’s headline inflation held at 2.0 per cent in June, as per official data, meeting the European Central Bank’s (ECB) target. ECB decision looms as rate cut hopes build The ECB is expected to hold interest rates steady at its July 25 meeting, according to all 84 economists surveyed by Reuters. However, a slight majority anticipate another rate cut later this year, most likely in September, if inflation continues to soften and growth remains fragile. (With inputs from agencies)

The euro zone’s economy shows cautious recovery, with July business activity hitting an 11-month high at a composite PMI of 51.0.

Euro zone activity picks up pace as services rebound, PMI hits 11-month high

New car sales in Europe dropped by 5.1 per cent in June, marking the steepest monthly decline in ten months, according to the European Automobile Manufacturers Association (ACEA). A total of 1.24 million new cars were registered across the European Union, the UK, and the European Free Trade Association, reflecting deepening challenges for traditional automakers. The region’s top four auto groups—Volkswagen, Stellantis, Renault, and Hyundai—posted lower year-on-year sales, down 6.1 per cent, 12.3 per cent, 0.6 per cent, and 8.7 per cent, respectively.&nbsp;Germany, the continent’s largest auto market, led the downturn with a 13.8 per cent fall in registrations, followed by Italy (17.4 per cent) and France (6.7 per cent). Only Britain and Spain posted gains, up 6.7 per cent and 15.2 per cent, respectively. Despite growth in electric vehicle (EV) segments—battery electric (up 7.8 per cent), hybrid electric (up 41.6 per cent), and plug-in hybrids (up 6.1 per cent)—the overall EV demand is slowing. The three combined vehicle types accounted for nearly 60 per cent of EU registrations in June, up from 50 per cent a year earlier, but sales are growing at the slowest pace this year. Industry groups are urging EU policymakers to provide fresh incentives for EV adoption to prevent further weakening.Adding to the pressure, automakers are contending with stiff competition from Chinese brands and mounting global trade tensions. Chinese companies such as BYD, Xpeng, and Leapmotor are gaining market share rapidly, with the share of non-ACEA brands, largely Chinese, more than doubling to 4.5 per cent in June. JATO Dynamics estimates Chinese brands now account for a record 5.1 per cent of Europe’s car market. The European Commission has granted a three-year reprieve on tighter carbon targets, but concerns remain over manufacturers' competitiveness, especially as US tariffs on imported vehicles continue to threaten profits.<h2>Tesla’s struggles mount as market share shrinks</h2>Tesla’s performance in Europe continued its downward trajectory in June, with the US electric vehicle maker posting a 22.9 per cent year-on-year drop in new car registrations, falling to 34,781 units. Its market share contracted to 2.8 per cent, down from 3.4 per cent a year earlier, marking the sixth consecutive monthly decline.Despite the broader growth in EV sales, Tesla is losing ground to both traditional rivals and emerging Chinese competitors. Analysts point to slowing sales of its key Model Y and rising competition from brands like BYD and Volkswagen, which have rolled out new models in Tesla’s core segments.The company is also contending with reputational challenges, attributed in part to CEO Elon Musk’s polarising political stance and alignment with US policies under the Trump administration a few months ago. These factors, combined with the expiration of US EV tax credits and higher tariff costs, are compounding its difficulties. Analysts suggest that Tesla could become a more niche player in Europe’s increasingly crowded EV market unless it leverages breakthrough technology or new product strategies to reclaim its early-mover advantage.<h2>EV incentives and hybrid growth offer some relief</h2>While fully electric vehicles posted a 14 per cent gain in June, growth remains uneven across the region. The reintroduction of EV grants in the UK, offering up to £3,750 ($5,077) for buyers, helped lift the country’s new car sales. Meanwhile, plug-in hybrid vehicles were a bright spot, with registrations surging by 38 per cent, reflecting growing consumer preference for dual-mode powertrains amid concerns over charging infrastructure.Still, Europe’s auto industry faces a challenging second half of 2025, with sluggish demand, tariff headwinds, and intensifying global competition forcing manufacturers to rethink strategies, accelerate innovation, and push for more robust policy support.&nbsp;(With inputs from agencies)

Tesla’s performance in Europe continued its downward trajectory in June, with the US electric vehicle maker posting a 22.9 per cent year-on-year drop in new car registrations, falling to 34,781 units. 

New car sales in Europe dropped by 5.1 per cent in June, marking the steepest monthly decline in ten months, according to the European Automobile Manufacturers Association (ACEA). A total of 1.24 million new cars were registered across the European Union, the UK, and the European Free Trade Association, reflecting deepening challenges for traditional automakers. The region’s top four auto groups—Volkswagen, Stellantis, Renault, and Hyundai—posted lower year-on-year sales, down 6.1 per cent, 12.3 per cent, 0.6 per cent, and 8.7 per cent, respectively. Germany, the continent’s largest auto market, led the downturn with a 13.8 per cent fall in registrations, followed by Italy (17.4 per cent) and France (6.7 per cent). Only Britain and Spain posted gains, up 6.7 per cent and 15.2 per cent, respectively. Despite growth in electric vehicle (EV) segments—battery electric (up 7.8 per cent), hybrid electric (up 41.6 per cent), and plug-in hybrids (up 6.1 per cent)—the overall EV demand is slowing. The three combined vehicle types accounted for nearly 60 per cent of EU registrations in June, up from 50 per cent a year earlier, but sales are growing at the slowest pace this year. Industry groups are urging EU policymakers to provide fresh incentives for EV adoption to prevent further weakening. Adding to the pressure, automakers are contending with stiff competition from Chinese brands and mounting global trade tensions. Chinese companies such as BYD, Xpeng, and Leapmotor are gaining market share rapidly, with the share of non-ACEA brands, largely Chinese, more than doubling to 4.5 per cent in June. JATO Dynamics estimates Chinese brands now account for a record 5.1 per cent of Europe’s car market. The European Commission has granted a three-year reprieve on tighter carbon targets, but concerns remain over manufacturers' competitiveness, especially as US tariffs on imported vehicles continue to threaten profits. Tesla’s struggles mount as market share shrinks Tesla’s performance in Europe continued its downward trajectory in June, with the US electric vehicle maker posting a 22.9 per cent year-on-year drop in new car registrations, falling to 34,781 units. Its market share contracted to 2.8 per cent, down from 3.4 per cent a year earlier, marking the sixth consecutive monthly decline. Despite the broader growth in EV sales, Tesla is losing ground to both traditional rivals and emerging Chinese competitors. Analysts point to slowing sales of its key Model Y and rising competition from brands like BYD and Volkswagen, which have rolled out new models in Tesla’s core segments. The company is also contending with reputational challenges, attributed in part to CEO Elon Musk’s polarising political stance and alignment with US policies under the Trump administration a few months ago. These factors, combined with the expiration of US EV tax credits and higher tariff costs, are compounding its difficulties. Analysts suggest that Tesla could become a more niche player in Europe’s increasingly crowded EV market unless it leverages breakthrough technology or new product strategies to reclaim its early-mover advantage. EV incentives and hybrid growth offer some relief While fully electric vehicles posted a 14 per cent gain in June, growth remains uneven across the region. The reintroduction of EV grants in the UK, offering up to £3,750 ($5,077) for buyers, helped lift the country’s new car sales. Meanwhile, plug-in hybrid vehicles were a bright spot, with registrations surging by 38 per cent, reflecting growing consumer preference for dual-mode powertrains amid concerns over charging infrastructure. Still, Europe’s auto industry faces a challenging second half of 2025, with sluggish demand, tariff headwinds, and intensifying global competition forcing manufacturers to rethink strategies, accelerate innovation, and push for more robust policy support. (With inputs from agencies)

Tesla’s performance in Europe continued its downward trajectory in June, with the US electric vehicle maker posting a 22.9 per cent year-on-year drop in new car registrations, falling to 34,781 units.&nbsp;

European car sales slump sharply in June amid industry headwinds

In a major diplomatic show off, India and the United Kingdom have finalised their long-awaited Free Trade Agreement (FTA), marking a historic shift in both nations’ post-pandemic economic strategy. The deal which was signed in London by Indian Commerce Minister Piyush Goyal and UK Business Secretary Jonathan Reynolds, is being touted as the UK’s largest post-Brexit trade pact and India’s most significant bilateral trade agreement in over a decade.&nbsp;So, what exactly is in the deal? Who stands to benefit the most? And why is this agreement being described as a strategic milestone beyond just trade?<h2>All about $34 billion deal</h2>At the heart of the deal lies a sharp ambition, first is to add over ₹2.86 lakh crore ($34.3 billion) to annual bilateral trade. British officials estimate it could inject up to £4.8 billion ($6.2 billion) into the UK’s GDP. For India, the agreement opens up new gateways for goods, services, and labour mobility in one of Europe’s richest markets. Both governments are framing this FTA as a partnership of equals, one designed to fuel growth, investment, and political trust.&nbsp;Prime Minister Narendra Modi hailed the agreement as a “defining moment” for India’s global trade strategy. “This deal reflects India’s commitment to rules-based international trade and deepens our economic partnership with a trusted democratic partner,” he said while addressing the press after signing the historic deal.&nbsp;On the other hand, UK Prime Minister Keir Starmer called it a “major win for British jobs, exports, and future growth,” adding that the agreement “symbolises a new era of collaboration with India, rooted in fairness and opportunity.”<h2>What does India gain?</h2>Indian exporters are arguably the biggest immediate winners. The agreement provides tariff-free access for 99 per cent of Indian goods entering the UK. This particularly benefiting sectors such as textiles, engineering products, jewellery, pharmaceuticals, and electric vehicles. As many of these categories earlier faced high duties in the UK previously, making them less competitive. With those barriers gone, Indian producers now have a cost advantage over rivals.&nbsp;Moreover, Indian service providers, especially in Information Technology, legal, telecom, and finance, will be able to tap into Britain’s competitive services market with fewer regulatory hurdles. The deal also includes a social security agreement to prevent Indian professionals on short-term UK assignments from paying into Britain’s pension system, reducing the cost of cross-border work.<h2>What does the UK gain?</h2>On the other hand, Britain has secured significant tariff reductions on its iconic exports. The most high-profile win is whisky. India’s steep 150 per cent import duty on Scotch will be cut to 75 per cent immediately and gradually lowered to 40 per cent over the next ten years. UK-made electric vehicles and luxury cars which are currently facing 100–110 per cent import duties will see those tariffs come down to 10 per cent, though under a strict quota system.&nbsp;Sectors like aerospace, medical equipment, and packaged food products will also benefit from greater access to Indian markets. The UK has also pushed for digital trade norms and intellectual property protections that align with its broader global trade agenda.<h2>What does the trade data shows?</h2>The UK has long run a trade deficit with India, it imports more from India than it exports to it. While Britain has seen rising exports of services to India, the goods trade has tilted heavily in India’s favour in recent years. The new FTA seeks to balance that by creating better access for UK goods and increasing the services pie for both countries.

<figure class="table"><table><tbody><tr><td>Year</td><td>UK Goods Exports</td><td>UK Services Exports</td><td>UK Goods Imports</td><td>UK Services Imports</td><td>UK Trade Deficit</td></tr><tr><td>2015</td><td>£3.5 bn ($4.6 bn)</td><td>£3.5 bn ($4.6 bn)</td><td>£5 bn ($6.5 bn)</td><td>£3.5 bn ($4.6 bn)</td><td>-£2.5 bn ($3.2 bn)</td></tr><tr><td>2020</td><td>£4 bn ($5.2 bn)</td><td>£4 bn ($5.2 bn)</td><td>£7 bn ($9.1 bn)</td><td>£5 bn ($6.5 bn)</td><td>-£4 bn ($5.2 bn)</td></tr><tr><td>2023</td><td>£6.5 bn ($8.4 bn)</td><td>£5.5 bn ($7.1 bn)</td><td>£9 bn ($11.7 bn)</td><td>£7 bn ($9.1 bn)</td><td>-£5 bn ($6.5 bn)</td></tr><tr><td>2024</td><td>£7.5 bn ($9.8 bn)</td><td>£6 bn ($7.8 bn)</td><td>£10.5 bn ($13.7 bn)</td><td>£8 bn ($10.4 bn)</td><td>-£5.5 bn ($7.2 bn)</td></tr></tbody></table></figure>Source: Office for National Statistics, UK (2024), via Bloomberg,

This persistent trade imbalance of about £5.5 billion ($7.2 billion) in 2024. It further reinforces that why the UK is keen to rebalance flows. India, meanwhile, benefits from consistent export growth, especially in technology and pharmaceuticals.&nbsp;Despite strong diplomatic ties, India still accounts for a relatively small portion of the UK’s overall trade volumes. A second data snapshot helps illustrate the scope of the opportunity.

<figure class="table"><table><tbody><tr><td>Rank</td><td>Exports Share</td><td>Imports Share</td></tr><tr><td>1. EU</td><td>47.7%</td><td>53.1%</td></tr><tr><td>2. US</td><td>16.2%</td><td>9.7%</td></tr><tr><td>3. Germany</td><td>8.8%</td><td>12.1%</td></tr><tr><td>4. Netherlands</td><td>7.6%</td><td>8.3%</td></tr><tr><td>5. Ireland</td><td>6.5%</td><td>—</td></tr><tr><td>6. India</td><td>1.9%</td><td>1.8%</td></tr></tbody></table></figure>Source: Office for National Statistics, UK (2024).&nbsp;

This data underscores how India ranks far behind the UK’s top trade partners, a gap that this FTA hopes to narrow. By easing tariffs, expanding service access, and encouraging labour mobility, the deal is expected to help India climb these rankings over time.<h2>A deeper play in a divided world</h2>Beyond the numbers, the timing of the deal is geopolitically significant. Both nations are responding to rising global protectionism and trade fragmentation. India is trying to diversify its export markets beyond China and the US, while the UK is looking to prove that post-Brexit trade diplomacy can work.&nbsp;This agreement is also symbolic as it positions India as a central partner in Britain’s Indo-Pacific tilt and reinforces the idea of “trusted democracies” building long-term trade resilience. Labour mobility, sustainable supply chains, and green tech collaboration are all expected to grow under the FTA’s framework.<h2>What happens next?</h2>The deal must now be ratified by both countries’ parliaments. Officials say the agreement could come into effect by early 2026. Meanwhile, parallel discussions on investment protection, carbon border tax alignment, and digital tax policy are still ongoing.&nbsp;Once implemented, this pact could become a blueprint for future India–EU and India–US trade deals, particularly in how it balances tariffs, services, and labour flows while respecting national policy space.&nbsp;(With inputs from the agencies)&nbsp;

The deal must now be ratified by both countries’ parliaments. Officials say the agreement could come into effect by early 2026. Meanwhile, parallel discussions on investment protection, carbon border tax alignment, and digital tax policy are still ongoing.

In a major diplomatic show off, India and the United Kingdom have finalised their long-awaited Free Trade Agreement (FTA), marking a historic shift in both nations’ post-pandemic economic strategy. The deal which was signed in London by Indian Commerce Minister Piyush Goyal and UK Business Secretary Jonathan Reynolds, is being touted as the UK’s largest post-Brexit trade pact and India’s most significant bilateral trade agreement in over a decade. So, what exactly is in the deal? Who stands to benefit the most? And why is this agreement being described as a strategic milestone beyond just trade? All about $34 billion deal At the heart of the deal lies a sharp ambition, first is to add over ₹2.86 lakh crore ($34.3 billion) to annual bilateral trade. British officials estimate it could inject up to £4.8 billion ($6.2 billion) into the UK’s GDP. For India, the agreement opens up new gateways for goods, services, and labour mobility in one of Europe’s richest markets. Both governments are framing this FTA as a partnership of equals, one designed to fuel growth, investment, and political trust. Prime Minister Narendra Modi hailed the agreement as a “defining moment” for India’s global trade strategy. “This deal reflects India’s commitment to rules-based international trade and deepens our economic partnership with a trusted democratic partner,” he said while addressing the press after signing the historic deal. On the other hand, UK Prime Minister Keir Starmer called it a “major win for British jobs, exports, and future growth,” adding that the agreement “symbolises a new era of collaboration with India, rooted in fairness and opportunity.” What does India gain? Indian exporters are arguably the biggest immediate winners. The agreement provides tariff-free access for 99 per cent of Indian goods entering the UK. This particularly benefiting sectors such as textiles, engineering products, jewellery, pharmaceuticals, and electric vehicles. As many of these categories earlier faced high duties in the UK previously, making them less competitive. With those barriers gone, Indian producers now have a cost advantage over rivals. Moreover, Indian service providers, especially in Information Technology, legal, telecom, and finance, will be able to tap into Britain’s competitive services market with fewer regulatory hurdles. The deal also includes a social security agreement to prevent Indian professionals on short-term UK assignments from paying into Britain’s pension system, reducing the cost of cross-border work. What does the UK gain? On the other hand, Britain has secured significant tariff reductions on its iconic exports. The most high-profile win is whisky. India’s steep 150 per cent import duty on Scotch will be cut to 75 per cent immediately and gradually lowered to 40 per cent over the next ten years. UK-made electric vehicles and luxury cars which are currently facing 100–110 per cent import duties will see those tariffs come down to 10 per cent, though under a strict quota system. Sectors like aerospace, medical equipment, and packaged food products will also benefit from greater access to Indian markets. The UK has also pushed for digital trade norms and intellectual property protections that align with its broader global trade agenda. What does the trade data shows? The UK has long run a trade deficit with India, it imports more from India than it exports to it. While Britain has seen rising exports of services to India, the goods trade has tilted heavily in India’s favour in recent years. The new FTA seeks to balance that by creating better access for UK goods and increasing the services pie for both countries.

In a historic moment, India and UK seal $34 billion annual trade push after 3 years of talks as US President Trump's tariffs shake global commerce.

What’s inside the $34 billion India–UK free trade deal?

The US aluminium industry is experiencing a surprising effect of President Donald Trump’s steep 50 per cent tariffs on imported primary aluminium: a surge in domestic recycling. While the tariffs were originally intended to revitalise US smelters and reduce reliance on foreign aluminium, they are also driving a boom in recycling activity, turning scrap yards into unexpected beneficiaries of trade protectionism. With aluminium import prices spiking, particularly in the US Midwest, where premiums have surged compared to 2024 levels, downstream manufacturers are facing higher production costs.&nbsp;As companies like beverage and food packaging firms contend with increased prices on cans and tinplate steel, many are seeking cheaper, more sustainable alternatives. That shift is accelerating demand for recycled aluminium, which consumes just 5 per cent of the energy needed to produce primary aluminium and is not subject to the same tariff restrictions. Adding to the momentum is the growing interest in low-carbon materials from automakers and global brands. This trend makes the recycled aluminium sector not only cost-effective but also environmentally aligned with broader industrial goals.<h2>Scrap market reverses flow as local demand soars</h2>A critical driver of the shift is the policy loophole exempting scrap metal from tariffs. While primary aluminium imports face a 50 per cent surcharge, scrap metal does not, allowing recyclers to profit from remelted aluminium sold at tariff-inflated prices. This dynamic has caused a sharp drop in US scrap exports, once totalling about 2 million tonnes annually, as more material is diverted to domestic use.The emerging economics have made US recycling facilities highly competitive, prompting discussions about implementing scrap export controls to retain supply. Analysts estimate that fully utilising scrap aluminium in the US could offset nearly half of the country’s 5.5-million-tonne annual import deficit, potentially replacing the need for four new primary smelters. Meanwhile, global suppliers eyeing the US market are constrained by volatile transatlantic trade conditions. Exporters in Europe, in particular, face uncertainty as the future of tariff alignments and trade agreements remains unsettled.<h2>Low-cost, low-carbon facilities attract investment</h2>The current environment favours recycling over new smelter construction. A new recycling plant requires only 10 per cent of the capital investment and can be completed in one to two years, compared to five or more for a traditional smelter. Companies like Hydro have already scaled up US operations, commissioning new facilities with over 300,000 tonnes of annual capacity.This rapid deployment is especially valuable as the energy-intensive aluminium industry competes for power with AI data centres and other emerging sectors. In this context, the energy efficiency of recycling adds to its appeal, not only for producers but also for investors and regulators focused on sustainability and supply resilience.In effect, while the tariffs are raising costs and adding complexity across the value chain, could they be setting the stage for a greener, more self-sufficient aluminium ecosystem in the US and reshaping the long-term trajectory of the industry?&nbsp;(With inputs from agencies)

A critical driver of the shift is the policy loophole exempting scrap metal from tariffs. While primary aluminium imports face a 50 per cent surcharge, scrap metal does not, allowing recyclers to profit from remelted aluminium sold at tariff-inflated prices.

The US aluminium industry is experiencing a surprising effect of President Donald Trump’s steep 50 per cent tariffs on imported primary aluminium: a surge in domestic recycling. While the tariffs were originally intended to revitalise US smelters and reduce reliance on foreign aluminium, they are also driving a boom in recycling activity, turning scrap yards into unexpected beneficiaries of trade protectionism. With aluminium import prices spiking, particularly in the US Midwest, where premiums have surged compared to 2024 levels, downstream manufacturers are facing higher production costs. As companies like beverage and food packaging firms contend with increased prices on cans and tinplate steel, many are seeking cheaper, more sustainable alternatives. That shift is accelerating demand for recycled aluminium, which consumes just 5 per cent of the energy needed to produce primary aluminium and is not subject to the same tariff restrictions. Adding to the momentum is the growing interest in low-carbon materials from automakers and global brands. This trend makes the recycled aluminium sector not only cost-effective but also environmentally aligned with broader industrial goals. Scrap market reverses flow as local demand soars A critical driver of the shift is the policy loophole exempting scrap metal from tariffs. While primary aluminium imports face a 50 per cent surcharge, scrap metal does not, allowing recyclers to profit from remelted aluminium sold at tariff-inflated prices. This dynamic has caused a sharp drop in US scrap exports, once totalling about 2 million tonnes annually, as more material is diverted to domestic use. The emerging economics have made US recycling facilities highly competitive, prompting discussions about implementing scrap export controls to retain supply. Analysts estimate that fully utilising scrap aluminium in the US could offset nearly half of the country’s 5.5-million-tonne annual import deficit, potentially replacing the need for four new primary smelters. Meanwhile, global suppliers eyeing the US market are constrained by volatile transatlantic trade conditions. Exporters in Europe, in particular, face uncertainty as the future of tariff alignments and trade agreements remains unsettled. Low-cost, low-carbon facilities attract investment The current environment favours recycling over new smelter construction. A new recycling plant requires only 10 per cent of the capital investment and can be completed in one to two years, compared to five or more for a traditional smelter. Companies like Hydro have already scaled up US operations, commissioning new facilities with over 300,000 tonnes of annual capacity. This rapid deployment is especially valuable as the energy-intensive aluminium industry competes for power with AI data centres and other emerging sectors. In this context, the energy efficiency of recycling adds to its appeal, not only for producers but also for investors and regulators focused on sustainability and supply resilience. In effect, while the tariffs are raising costs and adding complexity across the value chain, could they be setting the stage for a greener, more self-sufficient aluminium ecosystem in the US and reshaping the long-term trajectory of the industry? (With inputs from agencies)

A critical driver of the shift is the policy loophole exempting scrap metal from tariffs. While primary aluminium imports face a 50 per cent surcharge, scrap metal does not, allowing recyclers to profit from remelted aluminium sold at tariff-inflated prices.

Trump’s aluminium tariffs unintentionally fuel US recycling boom

After the Enforcement Directorate (ED) conducted a massive search operation at the premises of Anil Ambani's firms on Thursday, Reliance Infrastructure Limited (Reliance Infrastructure) and Reliance Power Limited (Reliance Power) released a statement clarifying that the recent actions have absolutely no impact on the business operations, financial performance, shareholders, employees, or any other stakeholders of Reliance Infrastructure and Reliance Power.&nbsp;The company further said in a statement that the media reports appear to pertain to allegations linked to transactions of Reliance Communications Limited (RCOM) or Reliance Home Finance Limited (RHFL), which are over 10 years old.&nbsp;The raid was conducted at 35 premises, 50 companies, and over 25 persons allegedly linked to the money laundering case against Reliance Anil Ambani Group (RAAGA) Companies with Yes Bank.<h3>No connection to RCOM or RHFL</h3>It has also been clarified in the press note that Reliance Power is a separate and independent listed entity, which has no business or financial connection to RCOM or RHFL.&nbsp;Currently, RCOM has been going through the Corporate Insolvency Resolution Process under the Insolvency and Bankruptcy Code, 2016, for over 6 years. Whereas, RHFL has been fully resolved according to the judgment of the Supreme Court of India, the statement further read.Also read: <a href="https://www.wionews.com/india-news/ed-raids-at-premises-of-anil-ambani-yes-bank-in-rs-3-000-crore-fraud-case-1753339608112">ED raids premises of Anil Ambani, Yes Bank in Rs 3,000 crore loan fraud case</a>&nbsp;According to a report by Indian news agency PTI, officials said over 35 premises across Mumbai and Delhi, involving 50 companies and about 25 individuals, are being searched under the Prevention of Money Laundering Act (PMLA).&nbsp;ED sources indicated that they are investigating allegations of illegal loan diversion of approximately Rs 3,000 crore from Yes Bank between 2017 and 2019. The load was reportedly diverted to shell firms and other group entities. Investigators have also discovered proof indicating possible bribery of Yes Bank officials, including its promoter.

Reliance Infrastructure Limited (Reliance Infrastructure) and Reliance Power Limited (Reliance Power) have released a statement clarifying that ongoing actions will have no impact on the business activities of the firms.

After the Enforcement Directorate (ED) conducted a massive search operation at the premises of Anil Ambani's firms on Thursday, Reliance Infrastructure Limited (Reliance Infrastructure) and Reliance Power Limited (Reliance Power) released a statement clarifying that the recent actions have absolutely no impact on the business operations, financial performance, shareholders, employees, or any other stakeholders of Reliance Infrastructure and Reliance Power. The company further said in a statement that the media reports appear to pertain to allegations linked to transactions of Reliance Communications Limited (RCOM) or Reliance Home Finance Limited (RHFL), which are over 10 years old. The raid was conducted at 35 premises, 50 companies, and over 25 persons allegedly linked to the money laundering case against Reliance Anil Ambani Group (RAAGA) Companies with Yes Bank. No connection to RCOM or RHFL It has also been clarified in the press note that Reliance Power is a separate and independent listed entity, which has no business or financial connection to RCOM or RHFL. Currently, RCOM has been going through the Corporate Insolvency Resolution Process under the Insolvency and Bankruptcy Code, 2016, for over 6 years. Whereas, RHFL has been fully resolved according to the judgment of the Supreme Court of India, the statement further read. Also read: ED raids premises of Anil Ambani, Yes Bank in Rs 3,000 crore loan fraud case According to a report by Indian news agency PTI, officials said over 35 premises across Mumbai and Delhi, involving 50 companies and about 25 individuals, are being searched under the Prevention of Money Laundering Act (PMLA). ED sources indicated that they are investigating allegations of illegal loan diversion of approximately Rs 3,000 crore from Yes Bank between 2017 and 2019. The load was reportedly diverted to shell firms and other group entities. Investigators have also discovered proof indicating possible bribery of Yes Bank officials, including its promoter.

Reliance Infrastructure Limited (Reliance Infrastructure) and Reliance Power Limited (Reliance Power) have released a statement clarifying that ongoing actions will have no impact on the business activities of the firms.

'Have no impact on business or stakeholders': Reliance Infrastructure, Reliance Power issue statements after ED raids

India and the United Kingdom (UK) are on the verge of a historic moment as Prime Minister Narendra Modi and UK Prime Minister Sir Keir Starmer prepare to sign a landmark Free Trade Agreement (FTA) this week. The agreement, which has been years in the making, will usher in significant tariff reductions and trade liberalisation, providing both nations with fresh economic opportunities. However, while India stands to benefit from expanded market access and cheaper goods, other global powers, particularly the United States and Japan, may face heightened competition in the Indian market.<h2>What you should know about the India-UK FTA</h2>The deal, finalised after nearly three years of negotiations, is poised to cut tariffs on more than 90 per cent of UK exports to India. These reductions will span a broad range of goods, including alcoholic beverages like Scotch whisky and gin, which will see tariffs reduced from 150 per cent to 75 per cent immediately and eventually to 40 per cent over the next decade. Likewise, British luxury cars will enjoy a major tariff cut, from over 100 per cent to 10 per cent, though the benefit will be subject to a quota system.The agreement also eliminates or reduces tariffs on a variety of consumer and industrial products, such as salmon, chocolates, machinery, cosmetics, and medical devices. Indian consumers can expect lower prices on imported goods, while UK manufacturers can gain a stronger foothold in India's growing market.For India, the deal provides preferential market access for nearly 99 per cent of its exports to the UK, particularly benefiting sectors like textiles, footwear, gems and jewellery, auto components, and pharmaceuticals. Indian textile hubs such as Tiruppur and Surat, as well as companies like Welspun India and Arvind Ltd., stand to gain from the elimination of UK tariffs on textiles and apparel. Indian manufacturers of footwear, like Bata India and Relaxo, will also be able to tap into the UK market duty-free. Furthermore, Indian electric vehicle makers like Tata Motors and Mahindra Electric will enjoy reduced tariffs and quotas on UK-bound electric and hybrid vehicles.In the services sector, the deal paves the way for easier short-term entry of Indian professionals, including yoga instructors, chefs, and musicians, to the UK. Indian workers on short-term transfers will be exempt from paying UK national insurance contributions for up to three years, offering significant cost savings for companies engaged in intra-company transfers.<h2>Impact on US Exports to India</h2>While the FTA marks a win for India and the UK, it introduces new challenges for other global players, particularly the United States. The agreement is expected to trigger heightened competition in a number of sectors where the US has a strong presence. The US exported $39 billion worth of goods to India in 2024, and approximately 3.2 per cent of that total, around $1.24 billion, could be exposed to increased competition from UK products.&nbsp;US exports to India most at risk include copper and iron waste, machinery, vehicle parts, contact lenses, and therapeutic equipment. The immediate tariff reductions on UK goods will create a price advantage for British producers, potentially eroding market share for US exporters in these segments. In particular, industries such as copper and iron waste, which account for a substantial portion of US exports to India, could see heightened competition from UK imports, further complicating the trade landscape.<h2>Japan faces competition in key export sectors</h2>Japan, another key player in the Indian market, is also likely to feel the impact of the India-UK FTA. In 2024, Japan exported $19.9 billion worth of goods to India. With the India-UK FTA now in place, about 2.2 per cent of Japan’s exports, or roughly $440 million, could face competition from lower-cost UK products. These include machinery, chemicals, and electronics, areas where both Japan and the UK have competitive stakes.The European Union, which exported $48.3 billion in goods to India last year, will also face some competition. Although the impact on EU exports is more limited, at around 1.7 per cent of its total shipments to India, the UK’s improved market access could still challenge EU exporters in certain sectors, such as luxury goods and food products.<h2>Strategic recalibration of trade alliances</h2>The India-UK FTA represents a strategic recalibration for both nations. For India, the deal offers access to advanced industrial and medical technologies at lower costs and presents new opportunities for Indian businesses to expand globally, especially in textiles, footwear, and pharmaceuticals. It also underscores India's growing role as a major player in international trade, seeking to diversify its trade partnerships beyond traditional allies like the US and Japan.The deal is expected to boost UK exports to India by 60 per cent by 2040, adding £4.8 billion ($6.5 billion) annually to the British economy and providing a substantial boost to the UK’s GDP. The agreement is a key step in the UK’s post-Brexit strategy, aimed at strengthening trade ties with the world’s fastest-growing major economy.India, meanwhile, is likely to see a surge in exports, particularly in the textile, gem, and jewellery sectors, as well as in agricultural goods like mangoes and grapes. The removal of tariffs on such products should help make Indian goods more competitive in the UK market.&nbsp;(With inputs from agencies)

While the FTA marks a win for India and the UK, it introduces new challenges for the US and Japan. The agreement is expected to trigger heightened competition in a number of sectors where the US has a strong presence, and Japan’s exports could face competition from lower-cost UK products.

India and the United Kingdom (UK) are on the verge of a historic moment as Prime Minister Narendra Modi and UK Prime Minister Sir Keir Starmer prepare to sign a landmark Free Trade Agreement (FTA) this week. The agreement, which has been years in the making, will usher in significant tariff reductions and trade liberalisation, providing both nations with fresh economic opportunities. However, while India stands to benefit from expanded market access and cheaper goods, other global powers, particularly the United States and Japan, may face heightened competition in the Indian market. What you should know about the India-UK FTA The deal, finalised after nearly three years of negotiations, is poised to cut tariffs on more than 90 per cent of UK exports to India. These reductions will span a broad range of goods, including alcoholic beverages like Scotch whisky and gin, which will see tariffs reduced from 150 per cent to 75 per cent immediately and eventually to 40 per cent over the next decade. Likewise, British luxury cars will enjoy a major tariff cut, from over 100 per cent to 10 per cent, though the benefit will be subject to a quota system. The agreement also eliminates or reduces tariffs on a variety of consumer and industrial products, such as salmon, chocolates, machinery, cosmetics, and medical devices. Indian consumers can expect lower prices on imported goods, while UK manufacturers can gain a stronger foothold in India's growing market. For India, the deal provides preferential market access for nearly 99 per cent of its exports to the UK, particularly benefiting sectors like textiles, footwear, gems and jewellery, auto components, and pharmaceuticals. Indian textile hubs such as Tiruppur and Surat, as well as companies like Welspun India and Arvind Ltd., stand to gain from the elimination of UK tariffs on textiles and apparel. Indian manufacturers of footwear, like Bata India and Relaxo, will also be able to tap into the UK market duty-free. Furthermore, Indian electric vehicle makers like Tata Motors and Mahindra Electric will enjoy reduced tariffs and quotas on UK-bound electric and hybrid vehicles. In the services sector, the deal paves the way for easier short-term entry of Indian professionals, including yoga instructors, chefs, and musicians, to the UK. Indian workers on short-term transfers will be exempt from paying UK national insurance contributions for up to three years, offering significant cost savings for companies engaged in intra-company transfers. Impact on US Exports to India While the FTA marks a win for India and the UK, it introduces new challenges for other global players, particularly the United States. The agreement is expected to trigger heightened competition in a number of sectors where the US has a strong presence. The US exported $39 billion worth of goods to India in 2024, and approximately 3.2 per cent of that total, around $1.24 billion, could be exposed to increased competition from UK products. US exports to India most at risk include copper and iron waste, machinery, vehicle parts, contact lenses, and therapeutic equipment. The immediate tariff reductions on UK goods will create a price advantage for British producers, potentially eroding market share for US exporters in these segments. In particular, industries such as copper and iron waste, which account for a substantial portion of US exports to India, could see heightened competition from UK imports, further complicating the trade landscape. Japan faces competition in key export sectors Japan, another key player in the Indian market, is also likely to feel the impact of the India-UK FTA. In 2024, Japan exported $19.9 billion worth of goods to India. With the India-UK FTA now in place, about 2.2 per cent of Japan’s exports, or roughly $440 million, could face competition from lower-cost UK products. These include machinery, chemicals, and electronics, areas where both Japan and the UK have competitive stakes. The European Union, which exported $48.3 billion in goods to India last year, will also face some competition. Although the impact on EU exports is more limited, at around 1.7 per cent of its total shipments to India, the UK’s improved market access could still challenge EU exporters in certain sectors, such as luxury goods and food products. Strategic recalibration of trade alliances The India-UK FTA represents a strategic recalibration for both nations. For India, the deal offers access to advanced industrial and medical technologies at lower costs and presents new opportunities for Indian businesses to expand globally, especially in textiles, footwear, and pharmaceuticals. It also underscores India's growing role as a major player in international trade, seeking to diversify its trade partnerships beyond traditional allies like the US and Japan. The deal is expected to boost UK exports to India by 60 per cent by 2040, adding £4.8 billion ($6.5 billion) annually to the British economy and providing a substantial boost to the UK’s GDP. The agreement is a key step in the UK’s post-Brexit strategy, aimed at strengthening trade ties with the world’s fastest-growing major economy. India, meanwhile, is likely to see a surge in exports, particularly in the textile, gem, and jewellery sectors, as well as in agricultural goods like mangoes and grapes. The removal of tariffs on such products should help make Indian goods more competitive in the UK market. (With inputs from agencies)

While the FTA marks a win for India and the UK, it introduces new challenges for the US and Japan. The agreement is expected to trigger heightened competition in a number of sectors where the US has a strong presence, and Japan’s exports could face competition from lower-cost UK products.

India and UK set to ink trade deal: What is on the cards?

Tesla’s recent quarterly earnings report revealed a sharp drop in revenue, marking its biggest decline in over a decade. The company’s second-quarter revenue fell 12 per cent to $22.5 billion, down from $25.5 billion in the same period last year. Despite efforts to refresh its Model Y and expand into autonomous vehicle services, Tesla continues to grapple with the impact of external challenges, including political tensions and regulatory shifts. Tesla's declining revenue was attributed to several key factors, including a significant drop in vehicle deliveries, which fell by 14 per cent in the second quarter.&nbsp;Additionally, the expiration of federal tax credits for electric vehicles, part of a sweeping fiscal package introduced by US President Donald Trump, added pressure. The loss of these green incentives is expected to further hit Tesla's sales in the coming months. CEO Elon Musk acknowledged the company’s struggles during an earnings call, stating that Tesla could face "a few rough quarters" as it adjusts to the changing regulatory landscape. The elimination of tax incentives and the impact of higher tariffs, especially on foreign-sourced vehicle components from China, have created an uncertain environment for the electric vehicle maker. Tesla’s operating margin also fell, dropping to 4.1 per cent from 6.3 per cent a year earlier.<h2>Musk’s political activity contributes to brand damage</h2>Tesla’s struggles are also compounded by Musk’s increasing political involvement. His recent political activities, such as his controversial support for former President Trump’s policies and his launch of a new political party, the “America Party,” have attracted criticism. Musk’s close association with Trump, along with his tenure at the Department of Government Efficiency (Doge), which led to significant federal layoffs, has alienated some consumers and investors. This fallout appears to have hurt Tesla’s brand image, particularly in Europe and the US.Musk’s shifting political allegiance, including endorsements of far-right parties, has raised questions about his focus on Tesla and whether his political actions could further damage the company's reputation.<h2>Robotaxis and AI as Tesla’s future growth drivers</h2>Despite the challenges, Musk remains optimistic about Tesla's future growth, particularly in the realm of artificial intelligence (AI) and autonomous driving. Tesla launched a robotaxi service in Austin, Texas, last month as part of its push toward self-driving technology. Musk emphasised that the rollout of robotaxis and the company's AI-powered humanoid robots would become central to Tesla’s long-term success.Additionally, Musk reiterated Tesla’s efforts to build a more affordable electric vehicle, which is expected to begin mass production by the second half of 2025. However, despite these optimistic projections, Tesla faces ongoing pressure from both political and market forces that could continue to affect its near-term performance.Tesla’s quarterly earnings serve as a reminder of the many challenges it faces, from regulatory pressures to political controversies. While the company’s long-term prospects remain tied to its AI and robotaxi ambitions, the CEO believes that coming quarters could prove difficult as it navigates the shifting landscape.&nbsp;(With inputs from agencies)

Despite the challenges, Elon Musk remains optimistic about Tesla's future growth, particularly in the realm of artificial intelligence (AI) and autonomous driving. Tesla launched a robotaxi service in Austin, Texas, last month as part of its push toward self-driving technology.

Tesla’s recent quarterly earnings report revealed a sharp drop in revenue, marking its biggest decline in over a decade. The company’s second-quarter revenue fell 12 per cent to $22.5 billion, down from $25.5 billion in the same period last year. Despite efforts to refresh its Model Y and expand into autonomous vehicle services, Tesla continues to grapple with the impact of external challenges, including political tensions and regulatory shifts. Tesla's declining revenue was attributed to several key factors, including a significant drop in vehicle deliveries, which fell by 14 per cent in the second quarter. Additionally, the expiration of federal tax credits for electric vehicles, part of a sweeping fiscal package introduced by US President Donald Trump, added pressure. The loss of these green incentives is expected to further hit Tesla's sales in the coming months. CEO Elon Musk acknowledged the company’s struggles during an earnings call, stating that Tesla could face "a few rough quarters" as it adjusts to the changing regulatory landscape. The elimination of tax incentives and the impact of higher tariffs, especially on foreign-sourced vehicle components from China, have created an uncertain environment for the electric vehicle maker. Tesla’s operating margin also fell, dropping to 4.1 per cent from 6.3 per cent a year earlier. Musk’s political activity contributes to brand damage Tesla’s struggles are also compounded by Musk’s increasing political involvement. His recent political activities, such as his controversial support for former President Trump’s policies and his launch of a new political party, the “America Party,” have attracted criticism. Musk’s close association with Trump, along with his tenure at the Department of Government Efficiency (Doge), which led to significant federal layoffs, has alienated some consumers and investors. This fallout appears to have hurt Tesla’s brand image, particularly in Europe and the US. Musk’s shifting political allegiance, including endorsements of far-right parties, has raised questions about his focus on Tesla and whether his political actions could further damage the company's reputation. Robotaxis and AI as Tesla’s future growth drivers Despite the challenges, Musk remains optimistic about Tesla's future growth, particularly in the realm of artificial intelligence (AI) and autonomous driving. Tesla launched a robotaxi service in Austin, Texas, last month as part of its push toward self-driving technology. Musk emphasised that the rollout of robotaxis and the company's AI-powered humanoid robots would become central to Tesla’s long-term success. Additionally, Musk reiterated Tesla’s efforts to build a more affordable electric vehicle, which is expected to begin mass production by the second half of 2025. However, despite these optimistic projections, Tesla faces ongoing pressure from both political and market forces that could continue to affect its near-term performance. Tesla’s quarterly earnings serve as a reminder of the many challenges it faces, from regulatory pressures to political controversies. While the company’s long-term prospects remain tied to its AI and robotaxi ambitions, the CEO believes that coming quarters could prove difficult as it navigates the shifting landscape. (With inputs from agencies)

Despite the challenges, Elon Musk remains optimistic about Tesla's future growth, particularly in the realm of artificial intelligence (AI) and autonomous driving. Tesla launched a robotaxi service in Austin, Texas, last month as part of its push toward self-driving technology.

Tesla's revenue declines sharply amid political controversy and policy shifts

In a major setback to former ICICI Bank CEO and Managing Director Chanda Kochhar, a tribunal in India has ruled that she accepted a bribe of nearly $7.7 million (₹64 crore) in exchange for sanctioning a $36 million (₹300 crore) loan to the Videocon Group in 2009. The ruling was issued by the Appellate Tribunal under the SAFEMA Act (Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act).&nbsp;The tribunal’s decision, dated July 3, 2025, overturns a 2020 ruling by an adjudicating authority that had released Kochhar’s assets. The new order states that the earlier decision was based on “irrelevant considerations” and had ignored “material facts.” According to PTI, the tribunal concluded that the loan granted to Videocon was directly linked to a quid pro quo deal benefitting Kochhar’s husband.<h2>Who is Chanda Kochhar?</h2>One of India’s most prominent bankers, Chanda Kochhar,&nbsp;was serving as the CEO and MD of ICICI Bank, the country’s second-largest private lender, from 2009 until 2018. Her rise in the Indian financial sector was once hailed as a symbol of women’s leadership in corporate India. But her career came under scrutiny in 2018 when whistleblower complaints flagged alleged conflicts of interest in loans sanctioned by the bank to the Videocon Group, a now-bankrupt conglomerate.<h2>What was the ICICI-Videocon loan deal?</h2>The case dates back to June 2009, when ICICI Bank, under Chanda Kochhar’s leadership, sanctioned a ₹300 crore loan to Videocon International Electronics Ltd, which was part of the Videocon Group led by Venugopal Dhoot. This loan was part of a larger ₹1,875 crore credit facility extended by ICICI Bank to various Videocon entities.&nbsp;According to Reuters, just a day after the $36 million (₹300 crore) loan was disbursed, $7.7 million (₹64 crore) was transferred from Videocon Group to NuPower Renewables Pvt Ltd, a company owned and controlled by Kochhar’s husband, Deepak Kochhar. The money was routed through another firm, Supreme Energy Pvt Ltd, which had connections to Videocon. The tribunal said this transfer clearly established a quid pro quo, suggesting that Kochhar misused her official position at ICICI Bank for personal benefit.<h2>What did the SAFEMA tribunal find?</h2>In its July 3, 2025 order, the tribunal overruled a 2020 decision by the adjudicating authority under the Prevention of Money Laundering Act (PMLA), which had declined to confirm the ED’s attachment of properties owned by the Kochhars. According to ANI, the tribunal described the earlier decision as “flawed”, citing “irrelevant considerations” and a failure to assess critical evidence.&nbsp;The tribunal accepted the Enforcement Directorate’s claim that the ₹64 crore was proceeds of crime and endorsed the ED’s provisional attachment of Kochhar’s assets, including a flat in Mumbai’s Churchgate area. As quoted by Bloomberg, the tribunal found no fault in the ED’s reasoning, instead criticising Chanda Kochhar’s attempt to distance herself from her husband’s business dealings. It also dismissed the argument that the loan sanction was a collective committee decision, holding that Kochhar was actively involved and bore responsibility as the MD and CEO.<h2>How did the investigation unfold?</h2>Whistleblower complaints first flagged the conflict of interest in 2016. Following that, the Central Bureau of Investigation (CBI) launched a preliminary enquiry in 2018. By January 2019, a formal FIR had been registered against Chanda Kochhar, Deepak Kochhar, and Videocon’s Venugopal Dhoot on charges of criminal conspiracy, cheating, and misuse of official position.In December 2022, all three were arrested, as per PTI, though they were later released on bail. The Supreme Court of India is currently monitoring the ongoing proceedings.<h2>What does this mean for ICICI Bank and corporate governance?</h2>The tribunal’s ruling not only reopens the focus on one of India’s biggest corporate-bank fraud scandals but also underscores major gaps in corporate governance. According to Reuters, the order strengthens the Enforcement Directorate’s case and reinforces the idea that top-level executives must be held accountable when conflicts of interest are ignored.&nbsp;ICICI Bank, which has long since distanced itself from Kochhar, has not yet issued a fresh statement post this ruling. Kochhar resigned from her post in October 2018, amid growing scrutiny and regulatory pressure.<h2>What’s next?</h2>The legal battle is far from over. While the tribunal has upheld the ED’s case, the matter may see further appeals. The ED and CBI continue to build their respective prosecutions, and the Supreme Court’s oversight suggests the case will remain under close judicial and public watch.&nbsp;As the investigation progresses, the case stands as a landmark in India’s fight against high-level corruption and financial misconduct in the banking sector.&nbsp;(With inputs from the agencies)

The decision, issued on July 3, 2025, overturned a previous ruling that had cleared Kochhar assets. The tribunal linked the loan to a quid pro quo arrangement involving her husband. Investigations began in 2016 following whistleblower complaints, leading to criminal charges in 2019. 

In a major setback to former ICICI Bank CEO and Managing Director Chanda Kochhar, a tribunal in India has ruled that she accepted a bribe of nearly $7.7 million (₹64 crore) in exchange for sanctioning a $36 million (₹300 crore) loan to the Videocon Group in 2009. The ruling was issued by the Appellate Tribunal under the SAFEMA Act (Smugglers and Foreign Exchange Manipulators (Forfeiture of Property) Act). The tribunal’s decision, dated July 3, 2025, overturns a 2020 ruling by an adjudicating authority that had released Kochhar’s assets. The new order states that the earlier decision was based on “irrelevant considerations” and had ignored “material facts.” According to PTI, the tribunal concluded that the loan granted to Videocon was directly linked to a quid pro quo deal benefitting Kochhar’s husband. Who is Chanda Kochhar? One of India’s most prominent bankers, Chanda Kochhar, was serving as the CEO and MD of ICICI Bank, the country’s second-largest private lender, from 2009 until 2018. Her rise in the Indian financial sector was once hailed as a symbol of women’s leadership in corporate India. But her career came under scrutiny in 2018 when whistleblower complaints flagged alleged conflicts of interest in loans sanctioned by the bank to the Videocon Group, a now-bankrupt conglomerate. What was the ICICI-Videocon loan deal? The case dates back to June 2009, when ICICI Bank, under Chanda Kochhar’s leadership, sanctioned a ₹300 crore loan to Videocon International Electronics Ltd, which was part of the Videocon Group led by Venugopal Dhoot. This loan was part of a larger ₹1,875 crore credit facility extended by ICICI Bank to various Videocon entities. According to Reuters, just a day after the $36 million (₹300 crore) loan was disbursed, $7.7 million (₹64 crore) was transferred from Videocon Group to NuPower Renewables Pvt Ltd, a company owned and controlled by Kochhar’s husband, Deepak Kochhar. The money was routed through another firm, Supreme Energy Pvt Ltd, which had connections to Videocon. The tribunal said this transfer clearly established a quid pro quo, suggesting that Kochhar misused her official position at ICICI Bank for personal benefit. What did the SAFEMA tribunal find? In its July 3, 2025 order, the tribunal overruled a 2020 decision by the adjudicating authority under the Prevention of Money Laundering Act (PMLA), which had declined to confirm the ED’s attachment of properties owned by the Kochhars. According to ANI, the tribunal described the earlier decision as “flawed”, citing “irrelevant considerations” and a failure to assess critical evidence. The tribunal accepted the Enforcement Directorate’s claim that the ₹64 crore was proceeds of crime and endorsed the ED’s provisional attachment of Kochhar’s assets, including a flat in Mumbai’s Churchgate area. As quoted by Bloomberg, the tribunal found no fault in the ED’s reasoning, instead criticising Chanda Kochhar’s attempt to distance herself from her husband’s business dealings. It also dismissed the argument that the loan sanction was a collective committee decision, holding that Kochhar was actively involved and bore responsibility as the MD and CEO. How did the investigation unfold? Whistleblower complaints first flagged the conflict of interest in 2016. Following that, the Central Bureau of Investigation (CBI) launched a preliminary enquiry in 2018. By January 2019, a formal FIR had been registered against Chanda Kochhar, Deepak Kochhar, and Videocon’s Venugopal Dhoot on charges of criminal conspiracy, cheating, and misuse of official position. In December 2022, all three were arrested, as per PTI, though they were later released on bail. The Supreme Court of India is currently monitoring the ongoing proceedings. What does this mean for ICICI Bank and corporate governance? The tribunal’s ruling not only reopens the focus on one of India’s biggest corporate-bank fraud scandals but also underscores major gaps in corporate governance. According to Reuters, the order strengthens the Enforcement Directorate’s case and reinforces the idea that top-level executives must be held accountable when conflicts of interest are ignored. ICICI Bank, which has long since distanced itself from Kochhar, has not yet issued a fresh statement post this ruling. Kochhar resigned from her post in October 2018, amid growing scrutiny and regulatory pressure. What’s next? The legal battle is far from over. While the tribunal has upheld the ED’s case, the matter may see further appeals. The ED and CBI continue to build their respective prosecutions, and the Supreme Court’s oversight suggests the case will remain under close judicial and public watch. As the investigation progresses, the case stands as a landmark in India’s fight against high-level corruption and financial misconduct in the banking sector. (With inputs from the agencies)

Chanda Kochhar, former CEO of ICICI Bank, faces significant legal trouble after a tribunal ruled that she accepted a bribe of approximately $7.7 million for approving a $36 million loan to the Videocon Group in 2009.

Chanda Kochhar found guilty of receiving ₹64 crore bribe: All about ICICI–Videocon loan case

High-stakes trade talks between South Korea and the United States have been postponed due to a scheduling conflict with US Treasury Secretary Scott Bessent, just days before a crucial deadline for President Donald Trump’s 25 per cent tariffs. The talks, which were scheduled for July 25, were expected to be a critical opportunity for South Korea to secure a deal that could shield its economy from severe tariff hikes. The trade negotiations, which had involved South Korea’s Finance Minister Koo Yun-cheol and top trade officials, were intended to address looming tariffs set to take effect on August 1. These tariffs would target key South Korean industries such as automobiles, steel, and semiconductors, threatening to disrupt the country’s export-driven economy.&nbsp;The meeting with Bessent was considered essential for reaching an agreement to avoid the looming tariff hike, which would significantly impact major South Korean companies like Hyundai, Kia, and Samsung. Despite the setback, South Korea is pushing ahead with separate talks. Minister for Trade Yeo Han-koo and Industry Minister Kim Jung-kwan remain in Washington and have continued negotiations with US officials, including US Trade Representative Jamieson Greer.<h2>US and South Korea seek broad trade deal</h2>While the cancellation of the Bessent meeting is a blow to South Korea, both sides are still working on a broader trade package that could include concessions on agriculture, energy, and increased US contributions to the costs of American military presence in South Korea. The US has also floated the idea of South Korea contributing to a large-scale investment fund for American manufacturing, mirroring a deal struck with Japan earlier this week.The South Korean government has expressed concerns that any agreement must not undermine the country’s sensitive farm markets, particularly on issues like rice and beef imports, though Seoul is expected to offer some concessions on agriculture and digital markets. With trade talks intensifying and the August 1 tariff deadline fast approaching, all eyes are on the ongoing discussions to see whether South Korea can secure an agreement that avoids the tariff hike while strengthening its economic ties with the United States.&nbsp;(With inputs from agencies)

While the cancellation of the Bessent meeting is a blow to South Korea, both sides are still working on a broader trade package that could include concessions on agriculture, energy, and increased US contributions to the costs of American military presence in South Korea.

High-stakes trade talks between South Korea and the United States have been postponed due to a scheduling conflict with US Treasury Secretary Scott Bessent, just days before a crucial deadline for President Donald Trump’s 25 per cent tariffs. The talks, which were scheduled for July 25, were expected to be a critical opportunity for South Korea to secure a deal that could shield its economy from severe tariff hikes. The trade negotiations, which had involved South Korea’s Finance Minister Koo Yun-cheol and top trade officials, were intended to address looming tariffs set to take effect on August 1. These tariffs would target key South Korean industries such as automobiles, steel, and semiconductors, threatening to disrupt the country’s export-driven economy. The meeting with Bessent was considered essential for reaching an agreement to avoid the looming tariff hike, which would significantly impact major South Korean companies like Hyundai, Kia, and Samsung. Despite the setback, South Korea is pushing ahead with separate talks. Minister for Trade Yeo Han-koo and Industry Minister Kim Jung-kwan remain in Washington and have continued negotiations with US officials, including US Trade Representative Jamieson Greer. US and South Korea seek broad trade deal While the cancellation of the Bessent meeting is a blow to South Korea, both sides are still working on a broader trade package that could include concessions on agriculture, energy, and increased US contributions to the costs of American military presence in South Korea. The US has also floated the idea of South Korea contributing to a large-scale investment fund for American manufacturing, mirroring a deal struck with Japan earlier this week. The South Korean government has expressed concerns that any agreement must not undermine the country’s sensitive farm markets, particularly on issues like rice and beef imports, though Seoul is expected to offer some concessions on agriculture and digital markets. With trade talks intensifying and the August 1 tariff deadline fast approaching, all eyes are on the ongoing discussions to see whether South Korea can secure an agreement that avoids the tariff hike while strengthening its economic ties with the United States. (With inputs from agencies)

While the cancellation of the Bessent meeting is a blow to South Korea, both sides are still working on a broader trade package that could include concessions on agriculture, energy, and increased US contributions to the costs of American military presence in South Korea.

US-South Korea trade talks postponed as tariff deadline looms

South Korea’s economy showed resilience in the second quarter of 2025, posting a 0.6 per cent growth compared to the previous quarter, reversing a 0.2 per cent contraction. The rebound was driven by stronger-than-expected exports, particularly in semiconductors, and a boost in consumer spending. The growth surpassed analysts' expectations, offering a glimmer of hope amid ongoing trade tensions and domestic financial risks. The economic bounce-back was largely fuelled by exports, which rose 4.2 per cent quarter-on-quarter in the April-June period. This surge was particularly notable in semiconductor shipments, which jumped significantly due to heightened global demand for AI-related technologies.&nbsp;Despite the looming risk of renewed tariffs from the United States, South Korea’s exports showed remarkable resilience. “In the second quarter, the impact of tariffs was limited, thanks to robust semiconductor exports and front-loading by businesses ahead of the expected tariff adjustments,” said a Bank of Korea official. The trade-reliant economy has been under pressure due to the US’s imposition of tariffs, with additional tariffs on products like autos and steel. However, the latest surge in exports suggests that the country’s technological edge remains a key asset.<h2>Strong consumer spending, but risks loom on the horizon</h2>Private consumption was another bright spot, rising by 0.5 per cent quarter-over-quarter. This improvement came as consumer sentiment picked up, buoyed by political stability after President Lee Jae Myung’s election in early June. Lee’s administration introduced a supplementary budget, including a consumer voucher program, to stimulate domestic demand.Despite this recovery in consumption, domestic investment in construction and facilities fell by 1.5 per cent, indicating that the economy's growth remains uneven. Analysts have warned that while government spending may provide a temporary boost, growth could soften in the coming quarters, especially with the looming risk of higher tariffs from the US.<h2>Central bank holds steady, eyes on tariff talks</h2>The growth figures offer some relief to the Bank of Korea (BOK), which has been balancing concerns about financial stability and economic recovery. The central bank held interest rates steady in July, citing concerns over the overheated housing market and rising household debt. However, with the economy showing signs of growth, the BOK may delay further rate cuts, at least until the fall.The government’s supplementary budget is expected to provide a modest lift to GDP, but economists caution that the slowdown in construction and investment may act as a drag on growth in the latter part of 2025.South Korea’s economy continues to be highly vulnerable to external pressures, particularly from the United States, which has threatened to impose a 25 per cent tariff on South Korean exports from August 1 if trade negotiations do not yield results. While semiconductor exports may cushion the blow, other sectors like automotive and steel remain at risk.As the government and central bank continue to navigate these challenges, much of the country’s economic momentum in the second half of 2025 will hinge on the outcome of ongoing trade talks with Washington.

Analysts have warned that while South Korea's government spending may provide a temporary boost, growth could soften in the coming quarters, especially with the looming risk of higher tariffs from the US.

South Korea’s economy showed resilience in the second quarter of 2025, posting a 0.6 per cent growth compared to the previous quarter, reversing a 0.2 per cent contraction. The rebound was driven by stronger-than-expected exports, particularly in semiconductors, and a boost in consumer spending. The growth surpassed analysts' expectations, offering a glimmer of hope amid ongoing trade tensions and domestic financial risks. The economic bounce-back was largely fuelled by exports, which rose 4.2 per cent quarter-on-quarter in the April-June period. This surge was particularly notable in semiconductor shipments, which jumped significantly due to heightened global demand for AI-related technologies. Despite the looming risk of renewed tariffs from the United States, South Korea’s exports showed remarkable resilience. “In the second quarter, the impact of tariffs was limited, thanks to robust semiconductor exports and front-loading by businesses ahead of the expected tariff adjustments,” said a Bank of Korea official. The trade-reliant economy has been under pressure due to the US’s imposition of tariffs, with additional tariffs on products like autos and steel. However, the latest surge in exports suggests that the country’s technological edge remains a key asset. Strong consumer spending, but risks loom on the horizon Private consumption was another bright spot, rising by 0.5 per cent quarter-over-quarter. This improvement came as consumer sentiment picked up, buoyed by political stability after President Lee Jae Myung’s election in early June. Lee’s administration introduced a supplementary budget, including a consumer voucher program, to stimulate domestic demand. Despite this recovery in consumption, domestic investment in construction and facilities fell by 1.5 per cent, indicating that the economy's growth remains uneven. Analysts have warned that while government spending may provide a temporary boost, growth could soften in the coming quarters, especially with the looming risk of higher tariffs from the US. Central bank holds steady, eyes on tariff talks The growth figures offer some relief to the Bank of Korea (BOK), which has been balancing concerns about financial stability and economic recovery. The central bank held interest rates steady in July, citing concerns over the overheated housing market and rising household debt. However, with the economy showing signs of growth, the BOK may delay further rate cuts, at least until the fall. The government’s supplementary budget is expected to provide a modest lift to GDP, but economists caution that the slowdown in construction and investment may act as a drag on growth in the latter part of 2025. South Korea’s economy continues to be highly vulnerable to external pressures, particularly from the United States, which has threatened to impose a 25 per cent tariff on South Korean exports from August 1 if trade negotiations do not yield results. While semiconductor exports may cushion the blow, other sectors like automotive and steel remain at risk. As the government and central bank continue to navigate these challenges, much of the country’s economic momentum in the second half of 2025 will hinge on the outcome of ongoing trade talks with Washington.

Analysts have warned that while South Korea's government spending may provide a temporary boost, growth could soften in the coming quarters, especially with the looming risk of higher tariffs from the US.

South Korea’s economy rebounds with strong exports and consumer spending

As fresh uncertainty over US trade policy dampened output and orders, according to a private survey released on Thursday,&nbsp;Japan’s manufacturing sector slipped back into contraction in July. The drop underscores widening divergence between the country’s struggling industrial base and its relatively buoyant services sector. Japan’s manufacturing purchasing managers’ index (PMI) fell to 48.8 in July, down from 50.1 in June, as per Reuters. This marked the first contraction since May and slipped below the 50-point threshold that separates expansion from contraction.&nbsp;“Uncertainty over future trade policy weighed on expectations regarding the year-ahead,” said Annabel Fiddes, Economics Associate Director at S&amp;P Global Market Intelligence, which compiled the data, as quoted by Reuters. The report further highlighted that key sub-indexes, such as output and new orders, declined at the fastest pace in four and three months respectively. Businesses remain wary of the impact from newly announced US tariffs, with many holding back on fresh investment and production.<h2>Impact of Trump’s tariff deal with Tokyo on manufacturing</h2>The decline in factory activity comes just days after US President Donald Trump unveiled a trade agreement with Japan. As per Reuters, the deal imposes a 15 per cent tariff on imports from Japan, in exchange for a promised $550 billion investment package from Tokyo into the US economy.&nbsp;While the pact spared Japan from harsher auto tariffs for now, it has renewed fears of deeper industrial disruption, especially for Japan’s export-driven manufacturers.<h2>Amid robust domestic demand services sector shines</h2>In contrast to the manufacturing downturn, Japan’s services sector showed notable resilience. The S&amp;P Global services' PMI rose to 53.5 in July from 51.7 in June, the fastest rate of growth in five months, driven by strong domestic demand and a rise in new business.&nbsp;“Business activity across Japan’s private sector continued to expand at the start of the third quarter, fuelled by stronger growth of the service sector,” Fiddes added, according to Reuters. However, signs of weakness were also present in the services data. New export business declined for the first time in seven months, and employment growth in the sector slowed to its weakest pace in nearly two years.<h2>Composite PMI holds steady</h2>The broader S&amp;P Global composite PMI, which combines both manufacturing and services, remained unchanged at 51.5 in July, matching June’s reading. This suggests that strength in the services sector is continuing to offset the drag from weakening factory activity, at least for now.&nbsp;Japan’s economic momentum appears increasingly reliant on domestic consumption and services, as external headwinds from US tariffs and slowing global trade weigh on its manufacturing base. With Tokyo navigating a complex trade environment under President Trump’s aggressive tariff regime, the divergence between the two sectors could grow further in the months ahead.&nbsp;(With inputs from the agencies)

The report further highlighted that key sub-indexes, such as output and new orders, declined at the fastest pace in four and three months respectively. Businesses remain wary of the impact from newly announced US tariffs, with many holding back on fresh investment and production.

As fresh uncertainty over US trade policy dampened output and orders, according to a private survey released on Thursday, Japan’s manufacturing sector slipped back into contraction in July. The drop underscores widening divergence between the country’s struggling industrial base and its relatively buoyant services sector. Japan’s manufacturing purchasing managers’ index (PMI) fell to 48.8 in July, down from 50.1 in June, as per Reuters. This marked the first contraction since May and slipped below the 50-point threshold that separates expansion from contraction. “Uncertainty over future trade policy weighed on expectations regarding the year-ahead,” said Annabel Fiddes, Economics Associate Director at S&P Global Market Intelligence, which compiled the data, as quoted by Reuters. The report further highlighted that key sub-indexes, such as output and new orders, declined at the fastest pace in four and three months respectively. Businesses remain wary of the impact from newly announced US tariffs, with many holding back on fresh investment and production. Impact of Trump’s tariff deal with Tokyo on manufacturing The decline in factory activity comes just days after US President Donald Trump unveiled a trade agreement with Japan. As per Reuters, the deal imposes a 15 per cent tariff on imports from Japan, in exchange for a promised $550 billion investment package from Tokyo into the US economy. While the pact spared Japan from harsher auto tariffs for now, it has renewed fears of deeper industrial disruption, especially for Japan’s export-driven manufacturers. Amid robust domestic demand services sector shines In contrast to the manufacturing downturn, Japan’s services sector showed notable resilience. The S&P Global services' PMI rose to 53.5 in July from 51.7 in June, the fastest rate of growth in five months, driven by strong domestic demand and a rise in new business. “Business activity across Japan’s private sector continued to expand at the start of the third quarter, fuelled by stronger growth of the service sector,” Fiddes added, according to Reuters. However, signs of weakness were also present in the services data. New export business declined for the first time in seven months, and employment growth in the sector slowed to its weakest pace in nearly two years. Composite PMI holds steady The broader S&P Global composite PMI, which combines both manufacturing and services, remained unchanged at 51.5 in July, matching June’s reading. This suggests that strength in the services sector is continuing to offset the drag from weakening factory activity, at least for now. Japan’s economic momentum appears increasingly reliant on domestic consumption and services, as external headwinds from US tariffs and slowing global trade weigh on its manufacturing base. With Tokyo navigating a complex trade environment under President Trump’s aggressive tariff regime, the divergence between the two sectors could grow further in the months ahead. (With inputs from the agencies)

Japan’s manufacturing PMI dips below 50 for the first time in two months, while services grow at fastest pace since February.

Japan factory activity contracts in July as US tariffs weigh

Easing geopolitical uncertainty and signs of progress in US-led trade negotiations reduced investor demand for safe-haven assets. On Thursday, gold prices steadied after a sharp decline. Amid optimism surrounding US trade deals with Japan and potentially the European Union, the metal had dropped 1.3 per cent in the previous session.&nbsp;&nbsp;Meanwhile, spot gold hovered near $3,389.77 an ounce at 8:24 a.m. in Singapore, up 0.1 per cent on the day, as per Bloomberg. Meanwhile, the Bloomberg Dollar Spot Index remained steady, though the dollar has fallen more than 1 per cent this week, providing some support to non-yielding assets like gold.<h2>Trade deals impact on gold’s shine</h2>Gold’s retreat comes after Bloomberg News reported that the European Union may be ready to accept a 15 per cent US tariff on most of its goods. This follows a similar deal with Japan, which included a $550 billion investment commitment into the US economy. The agreements are being viewed as diplomatic victories for President Donald Trump’s administration and a step toward stabilising global trade relations.&nbsp;“Progress in talks between the US and key trading partners hurt demand for haven assets,” Bloomberg noted in its report. The market is also digesting Trump’s warnings of additional tariffs, between 15 and 50 per cent, on countries such as South Korea and India, should they fail to reach trade deals before the August 1 deadline. While these threats cast some shadow, the broader tone remains optimistic, dampening the flight to safety that has boosted gold prices for much of the year.<h2>Yields rise, gold loses appeal</h2>Following the trade development, US Treasury yields rose for the first time in six days, further weighing on bullion. Since gold does not generate interest, it typically underperforms when yields rise, as investors shift to income-generating assets.&nbsp;Meanwhile, traders are closely watching the Federal Reserve’s July policy meeting. According to Bloomberg, money markets currently expect the Fed to keep interest rates steady next week, though a rate cut remains likely before October. There’s a 60 per cent probability of a quarter-point reduction at the September meeting. Lower rates typically support gold, as they reduce the opportunity cost of holding the metal, as per Bloomberg.<h2>Bullion rally may be cooling</h2>Gold prices have surged nearly 30 per cent so far in 2025, fuelled by global trade tensions, Russia’s invasion of Ukraine, and West Asia instability. The metal hit an all-time high of over $3,500 an ounce in April but has since been trading within a narrow band as markets await clearer signals on monetary policy and geopolitics.&nbsp;Still, the recent pullback may indicate that bullish momentum is starting to wane in the absence of fresh catalysts.<h2>Silver and other metals diverge</h2>While gold remained range-bound, silver continued to attract interest, especially from industrial buyers. The white metal steadied after briefly touching its highest level since 2011 earlier this week. According to Bloomberg, its demand is surging due to its widespread use in clean-energy technologies, including solar panels.&nbsp;Moreover, silver’s borrowing costs have risen above historical norms, signalling a supply squeeze. Growing holdings in exchange-traded funds have also reduced the amount of freely available metal in the market. Elsewhere, platinum prices rose modestly, while palladium extended losses.&nbsp;&nbsp;(With inputs from the agencies)&nbsp;

Gold prices have surged nearly 30 per cent so far in 2025, fuelled by global trade tensions, Russia invasion of Ukraine, and West Asia instability. The metal hit an all time high of over $3,500 an ounce in April. 

Easing geopolitical uncertainty and signs of progress in US-led trade negotiations reduced investor demand for safe-haven assets. On Thursday, gold prices steadied after a sharp decline. Amid optimism surrounding US trade deals with Japan and potentially the European Union, the metal had dropped 1.3 per cent in the previous session. Meanwhile, spot gold hovered near $3,389.77 an ounce at 8:24 a.m. in Singapore, up 0.1 per cent on the day, as per Bloomberg. Meanwhile, the Bloomberg Dollar Spot Index remained steady, though the dollar has fallen more than 1 per cent this week, providing some support to non-yielding assets like gold. Trade deals impact on gold’s shine Gold’s retreat comes after Bloomberg News reported that the European Union may be ready to accept a 15 per cent US tariff on most of its goods. This follows a similar deal with Japan, which included a $550 billion investment commitment into the US economy. The agreements are being viewed as diplomatic victories for President Donald Trump’s administration and a step toward stabilising global trade relations. “Progress in talks between the US and key trading partners hurt demand for haven assets,” Bloomberg noted in its report. The market is also digesting Trump’s warnings of additional tariffs, between 15 and 50 per cent, on countries such as South Korea and India, should they fail to reach trade deals before the August 1 deadline. While these threats cast some shadow, the broader tone remains optimistic, dampening the flight to safety that has boosted gold prices for much of the year. Yields rise, gold loses appeal Following the trade development, US Treasury yields rose for the first time in six days, further weighing on bullion. Since gold does not generate interest, it typically underperforms when yields rise, as investors shift to income-generating assets. Meanwhile, traders are closely watching the Federal Reserve’s July policy meeting. According to Bloomberg, money markets currently expect the Fed to keep interest rates steady next week, though a rate cut remains likely before October. There’s a 60 per cent probability of a quarter-point reduction at the September meeting. Lower rates typically support gold, as they reduce the opportunity cost of holding the metal, as per Bloomberg. Bullion rally may be cooling Gold prices have surged nearly 30 per cent so far in 2025, fuelled by global trade tensions, Russia’s invasion of Ukraine, and West Asia instability. The metal hit an all-time high of over $3,500 an ounce in April but has since been trading within a narrow band as markets await clearer signals on monetary policy and geopolitics. Still, the recent pullback may indicate that bullish momentum is starting to wane in the absence of fresh catalysts. Silver and other metals diverge While gold remained range-bound, silver continued to attract interest, especially from industrial buyers. The white metal steadied after briefly touching its highest level since 2011 earlier this week. According to Bloomberg, its demand is surging due to its widespread use in clean-energy technologies, including solar panels. Moreover, silver’s borrowing costs have risen above historical norms, signalling a supply squeeze. Growing holdings in exchange-traded funds have also reduced the amount of freely available metal in the market. Elsewhere, platinum prices rose modestly, while palladium extended losses. (With inputs from the agencies)

Precious metal stabilises after steep drop, as progress on US-EU and Japan trade deals lifts yields and weakens safe-haven appeal.

Gold price steadies as US trade deals dent safe-haven demand

China’s imports of three major energy products from the United States plunged to near zero in June, marking a sharp shift that could further complicate ongoing trade talks between Washington DC and Beijing. Deliveries of American crude oil, liquefied natural gas (LNG), and coal hit rock bottom, reflecting both economic and geopolitical factors at play. The trend represents a significant challenge for the Biden administration as it looks to re-engage with China on resolving their trade disputes.<h2>No US crude imports for the first time in three years</h2>China’s decision to forgo American crude oil imports last month for the first time in nearly three years underscores a growing trend of diversifying energy supplies. In June 2024, Chinese imports of US crude were valued at nearly $800 million. By June 2025, however, no shipments had arrived at Chinese ports. The sudden halt follows the 10-15 per cent tariffs imposed on US energy products starting in February 2018, when the US-China trade war began.Rystad Energy’s Lin Ye told Bloomberg that the decline in US energy imports, especially crude, signals China’s strategic shift towards suppliers like Saudi Arabia and Russia. These nations now dominate China's energy market, while US oil barely cracks the top 10 on the customs reports. “The move away from US crude is not just about cost but also about sending a message in the context of broader geopolitical tensions,” Ye said.<h2>Diversification amid tariffs and sanctions</h2>The reduction in US energy imports comes as Beijing works to reduce reliance on American sources. In addition to Saudi Arabia and Russia, China has increasingly relied on alternative suppliers for natural gas and coal. The country’s strategic response is also in part a countermeasure against US tariffs, sanctions, and broader diplomatic pressures.Moreover, Chinese companies have been selling US-sourced LNG to more profitable markets in Europe and Asia, further contributing to the decline in shipments from the US. Similarly, China’s coal imports from the US have dwindled, from over $90 million in June 2024 to a few hundred dollars in June 2025.While China had committed to purchasing more US energy and agricultural products under a 2020 trade agreement to help reduce its trade surplus, the Covid-19 pandemic disrupted those plans. With a growing trade imbalance and renewed friction under President Trump’s administration, China has recalibrated its energy imports to align with its broader foreign policy objectives.<h2>Crucial energy deals at stake</h2>As US Treasury Secretary Scott Bessent prepares to meet with Chinese counterparts in Stockholm next week, the reduction in energy imports will be a key issue in trade talks. Although the focus has been on semiconductor exports and rare earths, US energy exports remain an important tool for narrowing the trade deficit.With the US threatening new tariffs on countries buying Russian energy, China finds itself at a crossroads. While Russian gas imports to China have surged in the wake of the war in Ukraine, the US could leverage its energy exports to attract China back into the fold. However, a growing number of Chinese officials are likely to view this as a strategy of “unilateral pressure” that China is increasingly willing to defy.

While China had committed to purchasing more US energy and agricultural products under a 2020 trade agreement to help reduce its trade surplus, the Covid-19 pandemic disrupted those plans.

China’s imports of three major energy products from the United States plunged to near zero in June, marking a sharp shift that could further complicate ongoing trade talks between Washington DC and Beijing. Deliveries of American crude oil, liquefied natural gas (LNG), and coal hit rock bottom, reflecting both economic and geopolitical factors at play. The trend represents a significant challenge for the Biden administration as it looks to re-engage with China on resolving their trade disputes. No US crude imports for the first time in three years China’s decision to forgo American crude oil imports last month for the first time in nearly three years underscores a growing trend of diversifying energy supplies. In June 2024, Chinese imports of US crude were valued at nearly $800 million. By June 2025, however, no shipments had arrived at Chinese ports. The sudden halt follows the 10-15 per cent tariffs imposed on US energy products starting in February 2018, when the US-China trade war began. Rystad Energy’s Lin Ye told Bloomberg that the decline in US energy imports, especially crude, signals China’s strategic shift towards suppliers like Saudi Arabia and Russia. These nations now dominate China's energy market, while US oil barely cracks the top 10 on the customs reports. “The move away from US crude is not just about cost but also about sending a message in the context of broader geopolitical tensions,” Ye said. Diversification amid tariffs and sanctions The reduction in US energy imports comes as Beijing works to reduce reliance on American sources. In addition to Saudi Arabia and Russia, China has increasingly relied on alternative suppliers for natural gas and coal. The country’s strategic response is also in part a countermeasure against US tariffs, sanctions, and broader diplomatic pressures. Moreover, Chinese companies have been selling US-sourced LNG to more profitable markets in Europe and Asia, further contributing to the decline in shipments from the US. Similarly, China’s coal imports from the US have dwindled, from over $90 million in June 2024 to a few hundred dollars in June 2025. While China had committed to purchasing more US energy and agricultural products under a 2020 trade agreement to help reduce its trade surplus, the Covid-19 pandemic disrupted those plans. With a growing trade imbalance and renewed friction under President Trump’s administration, China has recalibrated its energy imports to align with its broader foreign policy objectives. Crucial energy deals at stake As US Treasury Secretary Scott Bessent prepares to meet with Chinese counterparts in Stockholm next week, the reduction in energy imports will be a key issue in trade talks. Although the focus has been on semiconductor exports and rare earths, US energy exports remain an important tool for narrowing the trade deficit. With the US threatening new tariffs on countries buying Russian energy, China finds itself at a crossroads. While Russian gas imports to China have surged in the wake of the war in Ukraine, the US could leverage its energy exports to attract China back into the fold. However, a growing number of Chinese officials are likely to view this as a strategy of “unilateral pressure” that China is increasingly willing to defy.

While China had committed to purchasing more US energy and agricultural products under a 2020 trade agreement to help reduce its trade surplus, the Covid-19 pandemic disrupted those plans.

China’s key US energy imports plunge amid trade tensions

On Thursday, Oil prices inched higher, supported by renewed optimism over US-led trade negotiations and a steeper-than-expected drop in American crude stockpiles. As US President Donald Trump’s recent tariff deal with Japan raised hopes of a broader easing of global trade tensions, markets remained cautiously upbeat. As per Reuters, Brent crude futures inched by 24 cents, or 0.4 per cent, to $68.75 a barrel by 0032 GMT. Meanwhile, US West Texas Intermediate (WTI) crude rose by 25 cents, or 0.4 per cent, to $65.50 per barrel. Though oil markets had remained subdued earlier in the week but the tide turned after the US and Japan reached a significant trade agreement. The deal spares Tokyo from new American auto import tariffs in exchange for a $550 billion package of investments and loans flowing into the US economy, as per Reuters.&nbsp;“Buying was driven by optimism that progress in tariff negotiations with the US would help avoid a worst-case scenario,” said Hiroyuki Kikukawa, chief strategist at Nissan Securities Investment, as quoted by Reuters. However, Kikukawa cautioned that crude gains may remain capped due to ongoing uncertainty around US-China trade talks and the fragile status of Russia–Ukraine peace negotiations. He further predicted that WTI prices are likely to stay range-bound between $60 and $70 per barrel.<h2>EU-US deal in the works?</h2>Adding to the upbeat tone, two European diplomats told Reuters that the US and the European Union are inching closer to a separate trade pact. The potential deal could include a baseline 15 per cent tariff on EU goods, with provisions for exemptions. This follows the Japan breakthrough and signals Washington’s strategy of building economic alliances to consolidate influence.<h2>US crude stockpiles fall</h2>On the supply front, US inventory data released by the Energy Information Administration (EIA) provided further support for oil prices. According to Reuters, US crude inventories fell by 3.2 million barrels last week to 419 million barrels. That drawdown was double the market expectation of a 1.6 million-barrel decline, indicating stronger-than-anticipated domestic demand.<h2>Impact of sanctions on Russian oil&nbsp;</h2>On Wednesday, peace talks between Russia and Ukraine were held in Istanbul, focusing on prisoner exchanges. However, a breakthrough on ceasefire terms or a direct summit between leaders appears distant, as per Reuters.&nbsp; Meanwhile, oil flows from Russia’s main Black Sea ports were temporarily disrupted. Industry sources told Reuters that new regulations effectively halted shipments from Kazakhstan via a key export consortium that includes American energy firms. Meanwhile, the US is considering broader energy sanctions.&nbsp;On Tuesday, the US Energy Secretary signalled that Washington may impose fresh sanctions on Russian oil in an effort to bring the Ukraine war to an end. The EU, on its part, adopted an 18th sanctions package on Friday, which includes lowering the price cap for Russian crude exports.&nbsp;(With inputs from the agencies)&nbsp;

On Wednesday, peace talks between Russia and Ukraine were held in Istanbul, focusing on prisoner exchanges. However, a breakthrough on ceasefire terms or a direct summit between leaders appears distant, as per Reuters.

On Thursday, Oil prices inched higher, supported by renewed optimism over US-led trade negotiations and a steeper-than-expected drop in American crude stockpiles. As US President Donald Trump’s recent tariff deal with Japan raised hopes of a broader easing of global trade tensions, markets remained cautiously upbeat. As per Reuters, Brent crude futures inched by 24 cents, or 0.4 per cent, to $68.75 a barrel by 0032 GMT. Meanwhile, US West Texas Intermediate (WTI) crude rose by 25 cents, or 0.4 per cent, to $65.50 per barrel. Though oil markets had remained subdued earlier in the week but the tide turned after the US and Japan reached a significant trade agreement. The deal spares Tokyo from new American auto import tariffs in exchange for a $550 billion package of investments and loans flowing into the US economy, as per Reuters. “Buying was driven by optimism that progress in tariff negotiations with the US would help avoid a worst-case scenario,” said Hiroyuki Kikukawa, chief strategist at Nissan Securities Investment, as quoted by Reuters. However, Kikukawa cautioned that crude gains may remain capped due to ongoing uncertainty around US-China trade talks and the fragile status of Russia–Ukraine peace negotiations. He further predicted that WTI prices are likely to stay range-bound between $60 and $70 per barrel. EU-US deal in the works? Adding to the upbeat tone, two European diplomats told Reuters that the US and the European Union are inching closer to a separate trade pact. The potential deal could include a baseline 15 per cent tariff on EU goods, with provisions for exemptions. This follows the Japan breakthrough and signals Washington’s strategy of building economic alliances to consolidate influence. US crude stockpiles fall On the supply front, US inventory data released by the Energy Information Administration (EIA) provided further support for oil prices. According to Reuters, US crude inventories fell by 3.2 million barrels last week to 419 million barrels. That drawdown was double the market expectation of a 1.6 million-barrel decline, indicating stronger-than-anticipated domestic demand. Impact of sanctions on Russian oil On Wednesday, peace talks between Russia and Ukraine were held in Istanbul, focusing on prisoner exchanges. However, a breakthrough on ceasefire terms or a direct summit between leaders appears distant, as per Reuters. Meanwhile, oil flows from Russia’s main Black Sea ports were temporarily disrupted. Industry sources told Reuters that new regulations effectively halted shipments from Kazakhstan via a key export consortium that includes American energy firms. Meanwhile, the US is considering broader energy sanctions. On Tuesday, the US Energy Secretary signalled that Washington may impose fresh sanctions on Russian oil in an effort to bring the Ukraine war to an end. The EU, on its part, adopted an 18th sanctions package on Friday, which includes lowering the price cap for Russian crude exports. (With inputs from the agencies)

Global crude markets steady amid US-Japan tariff deal, Russia-Ukraine tensions, and surprise inventory drawdown

Oil prices rise on US trade optimism, sharp fall in crude stockpiles

Is developing Asian countries&nbsp;growth engine is sputtering?&nbsp;On Wednesday, citing escalating US tariffs, China’s fragile recovery, and rising global uncertainty, the Asian Development Bank (ADB) lowered its growth forecast for the region for both 2025 and 2026.&nbsp;In its latest Asian Development Outlook which got released on Wednesday, the ADB cut its 2025 growth forecast for the region from 4.9 per cent to 4.7 per cent, and trimmed its 2026 projection from 4.7 per cent to 4.6 per cent. The bank in its report warned that domestic demand across much of Asia is expected to weaken as countries struggle with tighter financial conditions, supply chain disruptions, and the economic fallout of geopolitical tensions.&nbsp;“Asia and the Pacific has weathered an increasingly challenging external environment this year,” said ADB Chief Economist Albert Park, adding, “But the economic outlook has weakened amid intensifying risks and global uncertainty,” according to Reuters. Among the most immediate threats are tariff increases announced by US President Donald Trump. A new 15 per cent tariff on Japanese imports, reduced from a threatened 25 per cent, and a 19 per cent tariff on Philippine goods are just the latest in a broader push that has reshaped global trade flows. Since April, nearly all US trading partners have faced a baseline 10 per cent tariff, with many bracing for more from August 1. This sudden wave of protectionism has forced the ADB to revise down its regional projections.<h2>Southeast Asia worst hit</h2>Long seen as a regional growth engine, Southeast Asia is now expected to grow by only 4.2 per cent in 2025 which is down sharply from the 4.7 per cent projected in April. For 2026, the outlook has also weakened to 4.3 per cent, signalling that this isn’t a short-term shock but part of a broader structural slowdown.&nbsp;Thailand’s 2025 growth forecast has been slashed from 2.8 per cent to just 1.8 per cent, and is expected to dip further to 1.6 per cent in 2026. Similarliy, Malaysia's growth fell from 4.9 per cent to 4.3 per cent in 2025, before sliding to 4.2 per cent the following year. Singapore is forecast to slow to 1.6 per cent in 2025, and further to 1.5 per cent in 2026.&nbsp;The Philippines which is now facing a new 19 per cent US tariff, is forecast to grow 5.6 per cent in 2025. Which is slightly down from earlier projections, before rising modestly to 5.8 per cent in 2026. Vietnam stands out as one of the few resilient players, with 2025 growth revised upward to 6.5 per cent, though this is still lower than its pre-COVID trajectory.<h2>China slows, India holds steady</h2>Like Southeast Asia,&nbsp; East Asia's economic outlook has also darkened. The ADB now sees growth in the subregion easing to 4.3 per cent in 2025, slightly lower than April’s 4.4 per cent. The figure for 2026 holds at 4.0 per cent. China’s GDP forecast remains at 4.7 per cent for 2025, unchanged from April, but reflects a deep cooling from the 5.4 per cent growth seen in 2023. The world’s second-largest economy is grappling with structural challenges, from a weak property market to sluggish consumer spending. Its 2026 growth is expected to remain flat at 4.3 per cent.&nbsp;In contrast, South Asia, led by India, continues to outperform. While the region’s overall growth is expected to slow slightly to 5.9 per cent in 2025, India alone is projected to expand by 6.5 per cent, up from April’s 6.7 per cent but still one of the fastest rates globally. The 2026 estimate for India stands at 6.7 per cent, driven by robust consumption and services.<h2>Asian economic growth snapshot</h2>The latest ADB projections offer a mixed picture for developing Asia. While some economies like India and Vietnam continue to perform relatively well, much of the region faces slowing momentum, particularly Southeast Asia and China. Here’s a detailed look at the updated forecast.

<figure class="table"><table><tbody><tr><td>Region / Country</td><td>2023</td><td>2024</td><td>2025 (Apr)</td><td>2025 (Jul)</td><td>2026</td></tr><tr><td>Developing Asia</td><td>5.5</td><td>5.1</td><td>4.9</td><td>4.7</td><td>4.6</td></tr><tr><td>Caucasus &amp; Central Asia</td><td>5.4</td><td>5.7</td><td>5.4</td><td>5.5</td><td>5.1</td></tr><tr><td>East Asia</td><td>4.8</td><td>4.7</td><td>4.4</td><td>4.3</td><td>4.0</td></tr><tr><td>China</td><td>5.4</td><td>5.0</td><td>4.7</td><td>4.7</td><td>4.3</td></tr><tr><td>South Asia</td><td>7.8</td><td>5.9</td><td>6.0</td><td>5.9</td><td>6.2</td></tr><tr><td>India</td><td>9.2</td><td>6.5</td><td>6.7</td><td>6.5</td><td>6.7</td></tr><tr><td>Southeast Asia</td><td>4.1</td><td>4.8</td><td>4.7</td><td>4.2</td><td>4.3</td></tr><tr><td>Indonesia</td><td>5.0</td><td>5.0</td><td>5.0</td><td>5.0</td><td>5.1</td></tr><tr><td>Malaysia</td><td>3.6</td><td>4.9</td><td>4.9</td><td>4.3</td><td>4.2</td></tr><tr><td>Myanmar</td><td>0.8</td><td>-0.7</td><td>1.1</td><td>—</td><td>1.6</td></tr><tr><td>Philippines</td><td>6.0</td><td>6.2</td><td>5.6</td><td>5.6</td><td>5.8</td></tr><tr><td>Singapore</td><td>1.8</td><td>4.4</td><td>2.6</td><td>1.6</td><td>1.5</td></tr><tr><td>Thailand</td><td>2.0</td><td>2.5</td><td>2.8</td><td>1.8</td><td>1.6</td></tr><tr><td>Vietnam</td><td>7.1</td><td>6.6</td><td>6.3</td><td>6.5</td><td>6.0</td></tr><tr><td>Pacific region</td><td>4.7</td><td>4.1</td><td>3.9</td><td>3.9</td><td>3.5</td></tr></tbody></table></figure>Source: Asian Development Bank (ADB), July 2025 Outlook

The biggest downward revisions are concentrated in Southeast Asia, particularly in Thailand, where 2025 growth has been sharply downgraded to just 1.8 per cent from an earlier 2.8 per cent. The Philippines is expected to grow at 5.6 per cent, unchanged from April but still below earlier trends due to new US tariffs. Malaysia’s outlook has weakened too, now expected to grow 4.3 per cent in 2025, down from 4.9 per cent. In East Asia, China’s 2025 projection remains flat at 4.7 per cent, but there’s little hope of a rebound, with 2026 growth also stuck at 4.3 per cent. The ADB signals ongoing structural challenges in China’s real estate sector and weak domestic demand as major concerns. On the brighter side, India continues to outperform. Even with a modest downward revision, its 2025 growth is forecast at 6.5 per cent, with 2026 expected to rise again to 6.7 per cent, driven by stable consumption and investment-led stimulus. Vietnam has also shown resilience, with the ADB revising its 2025 forecast upward to 6.5 per cent, despite global trade disruptions. The Pacific region is expected to remain subdued, growing 3.9 per cent in 2025 and slowing further to 3.5 per cent in 2026, due to its high dependence on tourism and foreign aid flows, both of which remain volatile.<h2>Inflation pressures ease</h2>While growth is slowing, inflation appears to be moderating. The ADB now expects Developing Asia’s inflation rate to fall to 2.0 per cent in 2025, slightly lower than the 2.3 per cent it projected in April. In South Asia, inflation is expected to ease to 4.4 per cent, with India’s inflation stabilising at 3.8 per cent in 2025 and 4.0 per cent in 2026.&nbsp;Elsewhere in Southeast Asia, Indonesia’s inflation is forecast to drop to 1.5 per cent in 2025, while Thailand is expected to see inflation at just 0.5 per cent. Malaysia is projected to hold steady at 2.4 per cent, and Vietnam at 3.9 per cent. The outlier remains Myanmar, where inflation could exceed 20 per cent, largely driven by political instability, currency devaluation, and food insecurity.<h2>Reform or retreat?</h2>The ADB has urged countries across the region to resist inward-looking policies and instead strengthen their economic fundamentals. That includes pursuing open trade, deepening regional cooperation, and investing in sustainable growth to support jobs and long-term productivity. “Economies in the region should continue strengthening their fundamentals and promoting open trade and regional integration,” Park said.&nbsp;For now, the message is clear: Asia is entering a tougher, slower era of growth. Navigating the fallout from Trump-era tariffs, a weaker China, and shifting global demand will require more than policy tweaks. It may demand a full recalibration of Asia’s growth model. (With inputs from the agencies) &nbsp;

The 2025 growth projection is reduced from 4.9% to 4.7%, and for 2026 from 4.7% to 4.6%. Southeast Asia is particularly affected, with forecasts dropping to 4.2% for 2025 and 4.3% for 2026. Thailand forecast has been cut dramatically, while Malaysia and Singapore also see declines. 

Is developing Asian countries growth engine is sputtering? On Wednesday, citing escalating US tariffs, China’s fragile recovery, and rising global uncertainty, the Asian Development Bank (ADB) lowered its growth forecast for the region for both 2025 and 2026. In its latest Asian Development Outlook which got released on Wednesday, the ADB cut its 2025 growth forecast for the region from 4.9 per cent to 4.7 per cent, and trimmed its 2026 projection from 4.7 per cent to 4.6 per cent. The bank in its report warned that domestic demand across much of Asia is expected to weaken as countries struggle with tighter financial conditions, supply chain disruptions, and the economic fallout of geopolitical tensions. “Asia and the Pacific has weathered an increasingly challenging external environment this year,” said ADB Chief Economist Albert Park, adding, “But the economic outlook has weakened amid intensifying risks and global uncertainty,” according to Reuters. Among the most immediate threats are tariff increases announced by US President Donald Trump. A new 15 per cent tariff on Japanese imports, reduced from a threatened 25 per cent, and a 19 per cent tariff on Philippine goods are just the latest in a broader push that has reshaped global trade flows. Since April, nearly all US trading partners have faced a baseline 10 per cent tariff, with many bracing for more from August 1. This sudden wave of protectionism has forced the ADB to revise down its regional projections. Southeast Asia worst hit Long seen as a regional growth engine, Southeast Asia is now expected to grow by only 4.2 per cent in 2025 which is down sharply from the 4.7 per cent projected in April. For 2026, the outlook has also weakened to 4.3 per cent, signalling that this isn’t a short-term shock but part of a broader structural slowdown. Thailand’s 2025 growth forecast has been slashed from 2.8 per cent to just 1.8 per cent, and is expected to dip further to 1.6 per cent in 2026. Similarliy, Malaysia's growth fell from 4.9 per cent to 4.3 per cent in 2025, before sliding to 4.2 per cent the following year. Singapore is forecast to slow to 1.6 per cent in 2025, and further to 1.5 per cent in 2026. The Philippines which is now facing a new 19 per cent US tariff, is forecast to grow 5.6 per cent in 2025. Which is slightly down from earlier projections, before rising modestly to 5.8 per cent in 2026. Vietnam stands out as one of the few resilient players, with 2025 growth revised upward to 6.5 per cent, though this is still lower than its pre-COVID trajectory. China slows, India holds steady Like Southeast Asia, East Asia's economic outlook has also darkened. The ADB now sees growth in the subregion easing to 4.3 per cent in 2025, slightly lower than April’s 4.4 per cent. The figure for 2026 holds at 4.0 per cent. China’s GDP forecast remains at 4.7 per cent for 2025, unchanged from April, but reflects a deep cooling from the 5.4 per cent growth seen in 2023. The world’s second-largest economy is grappling with structural challenges, from a weak property market to sluggish consumer spending. Its 2026 growth is expected to remain flat at 4.3 per cent. In contrast, South Asia, led by India, continues to outperform. While the region’s overall growth is expected to slow slightly to 5.9 per cent in 2025, India alone is projected to expand by 6.5 per cent, up from April’s 6.7 per cent but still one of the fastest rates globally. The 2026 estimate for India stands at 6.7 per cent, driven by robust consumption and services. Asian economic growth snapshot The latest ADB projections offer a mixed picture for developing Asia. While some economies like India and Vietnam continue to perform relatively well, much of the region faces slowing momentum, particularly Southeast Asia and China. Here’s a detailed look at the updated forecast.

The Asian Development Bank (ADB) has revised down its growth forecasts for developing Asia due to escalating US tariffs, a fragile Chinese recovery, and rising global uncertainty.

Trump tariffs bite into Asia's growth as ADB flags economic chill

Luxury fashion’s post-pandemic boom is clearly losing its shine. With LVMH and Kering set to report yet another quarter of declining sales, investor concerns are mounting about a deeper, more structural slowdown in the $400 billion global luxury market.&nbsp;According to analysts surveyed by Visible Alpha, LVMH’s fashion and leather goods division, home to flagship brands Louis Vuitton and Dior is expected to post a 6 per cent year-on-year drop in sales, marking the fourth straight quarterly decline. Kering, which is undergoing a reset of its crown jewel Gucci, is expected to show an even steeper slump, with sales down nearly 25 per cent from a year ago. As luxury houses prepare to release earnings, beginning with LVMH on Thursday, the mood is increasingly cautious.<h2>Tariffs, tightening wallets and China uncertainty</h2>Two major markets, the US and China are no longer delivering the kind of demand luxury brands have long banked on. Shoppers are pulling back in the face of slowing economies, higher prices, and geopolitical tensions. The looming threat of new US tariffs on European imports, as high as 30 per cent under President Donald Trump’s trade agenda is adding more pressure to an already fragile landscape.&nbsp;Raising prices further in the US would be a risky move now, especially after previous hikes appear to have alienated middle-income customers. “The level of price increases has been too much,” said Caroline Reyl, head of premium brands at Pictet Asset Management, pointing to brands that may have pushed too far for too long.&nbsp;The so-called aspirational shopper, middle-income consumers who stretch to afford luxury items has become increasingly price-sensitive, and is now pulling back from handbag purchases, traditionally a key growth driver.<h2>Investors are growing cautious</h2>Shares in top luxury firms reflect this unease. Since January, LVMH shares are down nearly 27 per cent, while Kering has dropped 15 per cent. Hermès and Richemont, which cater to ultra-wealthy clientele, have fared better — Hermès shares dipped just 0.9 per cent, while Richemont gained 1.6 per cent.&nbsp;Once Europe’s most valuable listed company, LVMH has fallen to fifth place, a symbolic slide that underscores investors’ shifting confidence. “It seems that investors are starting to worry about the long-term structural attractiveness of the industry,” analysts at UBS warned last week.<h2>Handbags out, hybrid shoes in?</h2>Luxury brands are now pivoting towards lower-priced offerings and beauty products in an attempt to reignite demand. Louis Vuitton and Prada have introduced more items under the $1,000 mark, such as hybrid ballerina-sneaker shoes, in a bid to stay accessible without diluting brand prestige. But this approach carries reputational risk. Analysts at HSBC cautioned that brand inconsistency could hurt loyalty, particularly at Louis Vuitton. “The aspirational skew of the brand is unhelpful currently,” the bank said.&nbsp;Meanwhile, Hermès and Prada are expected to be the outliers this earnings season. Analysts forecast 10 per cent growth for both, driven by Prada’s Miu Miu label, which has been gaining ground among younger shoppers. LVMH will report earnings on July 25, followed by Kering on July 29, and Hermès and Prada on July 30. Their performance may offer a clearer glimpse into whether the current downturn is a passing phase or a reset for the luxury sector’s post-pandemic highs.&nbsp;&nbsp;(With inputs from the agencies)&nbsp;

Economic pressures, US tariffs, and uncertainties in major markets like the US and China are impacting demand. Investors are cautious, with LVMH shares down 27% this year. Brands are pivoting to lower priced items, though this risks brand integrity.

Luxury fashion’s post-pandemic boom is clearly losing its shine. With LVMH and Kering set to report yet another quarter of declining sales, investor concerns are mounting about a deeper, more structural slowdown in the $400 billion global luxury market. According to analysts surveyed by Visible Alpha, LVMH’s fashion and leather goods division, home to flagship brands Louis Vuitton and Dior is expected to post a 6 per cent year-on-year drop in sales, marking the fourth straight quarterly decline. Kering, which is undergoing a reset of its crown jewel Gucci, is expected to show an even steeper slump, with sales down nearly 25 per cent from a year ago. As luxury houses prepare to release earnings, beginning with LVMH on Thursday, the mood is increasingly cautious. Tariffs, tightening wallets and China uncertainty Two major markets, the US and China are no longer delivering the kind of demand luxury brands have long banked on. Shoppers are pulling back in the face of slowing economies, higher prices, and geopolitical tensions. The looming threat of new US tariffs on European imports, as high as 30 per cent under President Donald Trump’s trade agenda is adding more pressure to an already fragile landscape. Raising prices further in the US would be a risky move now, especially after previous hikes appear to have alienated middle-income customers. “The level of price increases has been too much,” said Caroline Reyl, head of premium brands at Pictet Asset Management, pointing to brands that may have pushed too far for too long. The so-called aspirational shopper, middle-income consumers who stretch to afford luxury items has become increasingly price-sensitive, and is now pulling back from handbag purchases, traditionally a key growth driver. Investors are growing cautious Shares in top luxury firms reflect this unease. Since January, LVMH shares are down nearly 27 per cent, while Kering has dropped 15 per cent. Hermès and Richemont, which cater to ultra-wealthy clientele, have fared better — Hermès shares dipped just 0.9 per cent, while Richemont gained 1.6 per cent. Once Europe’s most valuable listed company, LVMH has fallen to fifth place, a symbolic slide that underscores investors’ shifting confidence. “It seems that investors are starting to worry about the long-term structural attractiveness of the industry,” analysts at UBS warned last week. Handbags out, hybrid shoes in? Luxury brands are now pivoting towards lower-priced offerings and beauty products in an attempt to reignite demand. Louis Vuitton and Prada have introduced more items under the $1,000 mark, such as hybrid ballerina-sneaker shoes, in a bid to stay accessible without diluting brand prestige. But this approach carries reputational risk. Analysts at HSBC cautioned that brand inconsistency could hurt loyalty, particularly at Louis Vuitton. “The aspirational skew of the brand is unhelpful currently,” the bank said. Meanwhile, Hermès and Prada are expected to be the outliers this earnings season. Analysts forecast 10 per cent growth for both, driven by Prada’s Miu Miu label, which has been gaining ground among younger shoppers. LVMH will report earnings on July 25, followed by Kering on July 29, and Hermès and Prada on July 30. Their performance may offer a clearer glimpse into whether the current downturn is a passing phase or a reset for the luxury sector’s post-pandemic highs. (With inputs from the agencies)

Luxury fashion is experiencing a downturn with LVMH and Kering reporting declining sales. LVMH's fashion division anticipates a 6% drop, while Kering may face nearly a 25% slump as they struggle with changing consumer behavior and price sensitivity.

Luxury giants feel the chill as US tariffs, high prices hit demand

Global iron ore prices eased on Wednesday, pulling back from a five-month high, as investors responded to rising supply from Brazil’s Vale SA and weighed shifting demand signals from top importer China. In Singapore, iron ore futures dropped to $104.25 per tonne, after falling as much as 1.6 per cent earlier in the day.&nbsp;&nbsp;This comes after a sharp rally over the previous two sessions, when prices surged more than 4 per cent, driven in part by optimism around China’s infrastructure push, including a massive dam project in Tibet. However, fresh supply-side data and regulatory noise have now tempered those gains.<h2>Vale output surges</h2>Brazil’s mining giant Vale SA reported that it had produced 83.6 million tonnes of iron ore in the April–June quarter, its highest second-quarter output since 2021. The company noted that although production was up, sales lagged behind output, prompting it to offer a wider mix of ore grades to match varied market demand amid stressed steelmaker margins.&nbsp;Australia’s Fortescue Ltd., another major global supplier, is due to report its production numbers on Thursday, adding further market anticipation around global supply trends.<h2>China’s steel sector in flux</h2>Despite July’s modest gains, iron ore is still recovering from a prolonged five-month slide. Prices had tumbled earlier this year due to a combination of weak Chinese construction activity, high port inventories, and tighter financing for property developers.But Beijing has since signalled a shift in tone. Authorities are pushing for supply-side reforms in the steel sector, which could boost mills’ profitability and, by extension, raw material prices. At the same time, however, these reforms include curbs on overproduction, a policy that may end up dampening overall iron ore demand.&nbsp;“Policy signals point to renewed supply restrictions,” wrote Bloomberg Intelligence analysts including Michelle Leung. They noted that daily average crude steel output in China may “keep falling,” continuing a decline seen in early July. Iron ore’s trajectory now hinges on how these opposing forces play out: greater regulatory discipline and fiscal stimulus versus weaker actual steel production.<h2>Steel and coal under pressure</h2>In Shanghai, futures for rebar and hot-rolled coil, key finished steel products also fell in tandem with iron ore. Meanwhile, coking coal futures spiked in Dalian, after Chinese regulators vowed to crack down on overproduction, echoing their efforts in the steel sector.With both supply and policy dynamics in flux, traders are likely to remain cautious.&nbsp;(With inputs from the agencies)

Futures fell to $104.25 per tonne. Vale output surged, producing 83.6 million tonnes in Q2, but sales lagged. China steel sector faces policy changes impacting production, contributing to market uncertainty.

Global iron ore prices eased on Wednesday, pulling back from a five-month high, as investors responded to rising supply from Brazil’s Vale SA and weighed shifting demand signals from top importer China. In Singapore, iron ore futures dropped to $104.25 per tonne, after falling as much as 1.6 per cent earlier in the day. This comes after a sharp rally over the previous two sessions, when prices surged more than 4 per cent, driven in part by optimism around China’s infrastructure push, including a massive dam project in Tibet. However, fresh supply-side data and regulatory noise have now tempered those gains. Vale output surges Brazil’s mining giant Vale SA reported that it had produced 83.6 million tonnes of iron ore in the April–June quarter, its highest second-quarter output since 2021. The company noted that although production was up, sales lagged behind output, prompting it to offer a wider mix of ore grades to match varied market demand amid stressed steelmaker margins. Australia’s Fortescue Ltd., another major global supplier, is due to report its production numbers on Thursday, adding further market anticipation around global supply trends. China’s steel sector in flux Despite July’s modest gains, iron ore is still recovering from a prolonged five-month slide. Prices had tumbled earlier this year due to a combination of weak Chinese construction activity, high port inventories, and tighter financing for property developers. But Beijing has since signalled a shift in tone. Authorities are pushing for supply-side reforms in the steel sector, which could boost mills’ profitability and, by extension, raw material prices. At the same time, however, these reforms include curbs on overproduction, a policy that may end up dampening overall iron ore demand. “Policy signals point to renewed supply restrictions,” wrote Bloomberg Intelligence analysts including Michelle Leung. They noted that daily average crude steel output in China may “keep falling,” continuing a decline seen in early July. Iron ore’s trajectory now hinges on how these opposing forces play out: greater regulatory discipline and fiscal stimulus versus weaker actual steel production. Steel and coal under pressure In Shanghai, futures for rebar and hot-rolled coil, key finished steel products also fell in tandem with iron ore. Meanwhile, coking coal futures spiked in Dalian, after Chinese regulators vowed to crack down on overproduction, echoing their efforts in the steel sector. With both supply and policy dynamics in flux, traders are likely to remain cautious. (With inputs from the agencies)

Global iron ore prices declined on Wednesday, retreating from a five-month peak due to increasing supply from Brazil's Vale SA and shifting demand signals from China.

Iron ore dips from 5-month high on supply, China steel policy under lens

India’s central bank is stepping in to calm rising short-term borrowing costs. On Wednesday, the Reserve Bank of India (RBI) announced a ₹500 billion ($5.8 billion) liquidity injection into the banking system via a two-day repurchase (repo) auction, after money market rates unexpectedly spiked above the central bank’s policy benchmark.&nbsp;The move comes after the weighted average call rate, a key interbank borrowing rate that the RBI closely watches, surged to 5.79 per cent, overtaking the RBI’s repo rate of 5.5 per cent. According to Bloomberg, this marks the first time since March that overnight funding costs have breached the RBI’s policy rate, a development that raises fresh questions about liquidity management and monetary transmission. In a statement, the RBI cited “current and evolving liquidity conditions” as the reason for the cash injection.<h2>Why borrowing costs spiked</h2>The sudden rise in borrowing costs is being linked to monthly tax outflows, particularly GST payments, which pulled large sums out of the banking system. At the same time, aggressive participation by banks in the RBI’s variable rate reverse repo (VRRR) operations, where the central bank absorbs excess liquidity appears to have backfired.&nbsp;“It seems that banks tendered very aggressively at the last variable rate reverse repurchase operation and once the GST outflows hit the system, they were left with a situation they did not envisage,” said Abhishek Upadhyay, economist at ICICI Securities Primary Dealership Ltd., as quoted by Bloomberg. This mismatch between inflows and outflows highlights the challenge of managing liquidity in a fast-digitising economy where funds move 24/7.<h2>What’s behind the volatility?</h2>While liquidity fluctuations are not new, the RBI is under increasing pressure to stabilise funding rates, especially when they deviate from the policy rate, a critical anchor for borrowing costs across the economy. According to DBS Bank Ltd., nearly ₹2 trillion ($24 billion) is currently locked in a seven-day VRRR with the RBI, draining liquidity from the system.&nbsp;Surplus liquidity, the excess cash parked by banks with the RBI, dropped to ₹2.2 trillion ($26 billion) as of July 22, down sharply from ₹3.9 trillion just a few days earlier, according to Bloomberg Economics estimates. Bond traders are now seeking greater clarity from the RBI on how much surplus liquidity it considers “ideal” following its recent liquidity-draining actions, Bloomberg News reported, citing sources familiar with the matter.<h2>More auctions ahead, but with caution</h2>The RBI is widely expected to continue with its variable rate reverse repo auctions, albeit with smaller amounts, as the market digests recent volatility. “The RBI will likely continue to offer the VRRR auction, though likely reduce the size,” said Nathan Sribalasundaram, rates strategist at Nomura Holdings Inc. “Banks are likely to be a little more cautious this time around.”&nbsp;The RBI’s next monetary policy meeting is scheduled for August 6, and money market participants will be watching closely for signs of how the central bank plans to recalibrate its liquidity framework. According to RBI Governor Shaktikanta Das, a detailed report on this new liquidity model is expected by end-July.&nbsp;For now, the central bank’s latest action serves as a reminder of the delicate balance it must strike keeping short-term funding markets stable without undermining its broader inflation and monetary policy goals.&nbsp;(With inputs from the agencies)

This spike is attributed to monthly tax outflows, especially GST payments, and aggressive bank participation in RBI variable rate reverse repo operations, leading to a liquidity mismatch.

India’s central bank is stepping in to calm rising short-term borrowing costs. On Wednesday, the Reserve Bank of India (RBI) announced a ₹500 billion ($5.8 billion) liquidity injection into the banking system via a two-day repurchase (repo) auction, after money market rates unexpectedly spiked above the central bank’s policy benchmark. The move comes after the weighted average call rate, a key interbank borrowing rate that the RBI closely watches, surged to 5.79 per cent, overtaking the RBI’s repo rate of 5.5 per cent. According to Bloomberg, this marks the first time since March that overnight funding costs have breached the RBI’s policy rate, a development that raises fresh questions about liquidity management and monetary transmission. In a statement, the RBI cited “current and evolving liquidity conditions” as the reason for the cash injection. Why borrowing costs spiked The sudden rise in borrowing costs is being linked to monthly tax outflows, particularly GST payments, which pulled large sums out of the banking system. At the same time, aggressive participation by banks in the RBI’s variable rate reverse repo (VRRR) operations, where the central bank absorbs excess liquidity appears to have backfired. “It seems that banks tendered very aggressively at the last variable rate reverse repurchase operation and once the GST outflows hit the system, they were left with a situation they did not envisage,” said Abhishek Upadhyay, economist at ICICI Securities Primary Dealership Ltd., as quoted by Bloomberg. This mismatch between inflows and outflows highlights the challenge of managing liquidity in a fast-digitising economy where funds move 24/7. What’s behind the volatility? While liquidity fluctuations are not new, the RBI is under increasing pressure to stabilise funding rates, especially when they deviate from the policy rate, a critical anchor for borrowing costs across the economy. According to DBS Bank Ltd., nearly ₹2 trillion ($24 billion) is currently locked in a seven-day VRRR with the RBI, draining liquidity from the system. Surplus liquidity, the excess cash parked by banks with the RBI, dropped to ₹2.2 trillion ($26 billion) as of July 22, down sharply from ₹3.9 trillion just a few days earlier, according to Bloomberg Economics estimates. Bond traders are now seeking greater clarity from the RBI on how much surplus liquidity it considers “ideal” following its recent liquidity-draining actions, Bloomberg News reported, citing sources familiar with the matter. More auctions ahead, but with caution The RBI is widely expected to continue with its variable rate reverse repo auctions, albeit with smaller amounts, as the market digests recent volatility. “The RBI will likely continue to offer the VRRR auction, though likely reduce the size,” said Nathan Sribalasundaram, rates strategist at Nomura Holdings Inc. “Banks are likely to be a little more cautious this time around.” The RBI’s next monetary policy meeting is scheduled for August 6, and money market participants will be watching closely for signs of how the central bank plans to recalibrate its liquidity framework. According to RBI Governor Shaktikanta Das, a detailed report on this new liquidity model is expected by end-July. For now, the central bank’s latest action serves as a reminder of the delicate balance it must strike keeping short-term funding markets stable without undermining its broader inflation and monetary policy goals. (With inputs from the agencies)

India's Reserve Bank (RBI) injected ₹500 billion ($5.8 billion) into the banking system via a two-day repo auction to address rising short-term borrowing costs, as the weighted average call rate surged to 5.79%, surpassing the RBI's repo rate of 5.5%.

RBI steps in with cash boost as borrowing costs surge

A day after Japan clinched a trade deal with the United States that lowers tariffs and unlocks investment flows, South Korea is now scrambling to secure a similar or better outcome, fearing economic fallout if left behind. With just days to go before an August 1 deadline, Seoul's top trade negotiators are headed to Washington to engage in high-level talks with US officials. The goal is to avoid steep 25 per cent reciprocal tariffs and secure a deal that keeps Korea globally competitive.&nbsp;The urgency stems from Japan’s newly signed pact with the US, which lowers tariffs on Japanese imports to 15 per cent, down from a proposed 25 per cent, and includes a sweeping $550 billion Japanese investment pledge into the US economy.<h2>What did Seoul say?&nbsp;</h2>South Korean Industry Minister Kim Jung-kwan, before boarding his flight to Washington, vowed a proactive response. “We will make an all-out effort to produce a positive-sum result that will allow Korea–US industrial and energy cooperation to be upgraded to the next level,” he said in a statement, as quoted by Reuters.&nbsp;He acknowledged the deal could have a “significant economic impact” and stressed the need to protect sensitive Korean industries. Kim is expected to meet with US Commerce Secretary Howard Lutnick and Energy Secretary Chris Wright, in talks that may shape the economic direction of Asia’s fourth-largest economy.<h2>Japan's deal effect on Seoul&nbsp;</h2>Japan’s deal has created ripples across Seoul’s financial markets and policymaking circles. The KOSPI index dipped 0.3 per cent on Wednesday, but shares of major Korean automakers, including Hyundai Motor (+6.8 per cent) and Kia (+6.4 per cent) rallied, riding expectations of a favourable outcome.&nbsp;Still, analysts warn that Japan’s agreement could become the benchmark, making Seoul’s negotiating position more difficult. “Investors see the Japan–US deal as a benchmark for the Korean deal,” said Kim Sung-rae, an analyst at Hanwha Investment &amp; Securities, adding that Korean officials would be under pressure “to come up with a similar, or better, deal.”<h2>No rice or beef on the table</h2>In terms of concessions, South Korea is unlikely to open its rice and beef markets, two politically sensitive sectors. Instead, as per Yonhap News Agency, Seoul is reportedly willing to expand imports of US biofuel crops, such as corn for bioethanol, and increase energy and tech cooperation.&nbsp;According to Professor Kim Yong-jin of Sogang University, matching or beating Japan’s deal won’t be easy. “It will be difficult for South Korea to have US tariff rates lower than 15 per cent on Japan and 10 per cent on Britain,” he told Reuters. He added that, like Japan, Korea may have to import more agricultural goods and energy and boost outbound investments to seal a deal.<h2>The Trump angle</h2>On social media platform Truth Social, US President Donald Trump hailed the Japan agreement, saying it would expand access for American cars, trucks, rice, and other farm goods, while also touting massive Japanese investments in US manufacturing.&nbsp;Trump has made it clear that allies who help rebuild the US industrial base will get preferential trade treatment. Last week, Chosun Ilbo reported that Washington had asked South Korea to set up a large-scale investment fund to aid in US factory reconstruction though no official source was cited.<h2>Seoul’s next move</h2>The road ahead won’t be easy. South Korea competes directly with Japan in automobiles, semiconductors, and steel, all sectors under scrutiny in Washington. Seoul’s trade team will need to walk a tightrope between protecting domestic interests and securing market access.&nbsp;Newly elected President Lee Jae Myung has made clear that he wants “no comparative disadvantage” in trade agreements. For now, the outcome of this Washington visit could decide more than just tariffs. It could determine how South Korea positions itself in a fast-changing, protectionist global trade order.&nbsp;(With inputs from the agencies)

With an August 1 deadline approaching, South Korean Industry Minister Kim Jung kwan emphasizes the need for proactive measures to enhance industrial and energy cooperation.

A day after Japan clinched a trade deal with the United States that lowers tariffs and unlocks investment flows, South Korea is now scrambling to secure a similar or better outcome, fearing economic fallout if left behind. With just days to go before an August 1 deadline, Seoul's top trade negotiators are headed to Washington to engage in high-level talks with US officials. The goal is to avoid steep 25 per cent reciprocal tariffs and secure a deal that keeps Korea globally competitive. The urgency stems from Japan’s newly signed pact with the US, which lowers tariffs on Japanese imports to 15 per cent, down from a proposed 25 per cent, and includes a sweeping $550 billion Japanese investment pledge into the US economy. What did Seoul say? South Korean Industry Minister Kim Jung-kwan, before boarding his flight to Washington, vowed a proactive response. “We will make an all-out effort to produce a positive-sum result that will allow Korea–US industrial and energy cooperation to be upgraded to the next level,” he said in a statement, as quoted by Reuters. He acknowledged the deal could have a “significant economic impact” and stressed the need to protect sensitive Korean industries. Kim is expected to meet with US Commerce Secretary Howard Lutnick and Energy Secretary Chris Wright, in talks that may shape the economic direction of Asia’s fourth-largest economy. Japan's deal effect on Seoul Japan’s deal has created ripples across Seoul’s financial markets and policymaking circles. The KOSPI index dipped 0.3 per cent on Wednesday, but shares of major Korean automakers, including Hyundai Motor (+6.8 per cent) and Kia (+6.4 per cent) rallied, riding expectations of a favourable outcome. Still, analysts warn that Japan’s agreement could become the benchmark, making Seoul’s negotiating position more difficult. “Investors see the Japan–US deal as a benchmark for the Korean deal,” said Kim Sung-rae, an analyst at Hanwha Investment & Securities, adding that Korean officials would be under pressure “to come up with a similar, or better, deal.” No rice or beef on the table In terms of concessions, South Korea is unlikely to open its rice and beef markets, two politically sensitive sectors. Instead, as per Yonhap News Agency, Seoul is reportedly willing to expand imports of US biofuel crops, such as corn for bioethanol, and increase energy and tech cooperation. According to Professor Kim Yong-jin of Sogang University, matching or beating Japan’s deal won’t be easy. “It will be difficult for South Korea to have US tariff rates lower than 15 per cent on Japan and 10 per cent on Britain,” he told Reuters. He added that, like Japan, Korea may have to import more agricultural goods and energy and boost outbound investments to seal a deal. The Trump angle On social media platform Truth Social, US President Donald Trump hailed the Japan agreement, saying it would expand access for American cars, trucks, rice, and other farm goods, while also touting massive Japanese investments in US manufacturing. Trump has made it clear that allies who help rebuild the US industrial base will get preferential trade treatment. Last week, Chosun Ilbo reported that Washington had asked South Korea to set up a large-scale investment fund to aid in US factory reconstruction though no official source was cited. Seoul’s next move The road ahead won’t be easy. South Korea competes directly with Japan in automobiles, semiconductors, and steel, all sectors under scrutiny in Washington. Seoul’s trade team will need to walk a tightrope between protecting domestic interests and securing market access. Newly elected President Lee Jae Myung has made clear that he wants “no comparative disadvantage” in trade agreements. For now, the outcome of this Washington visit could decide more than just tariffs. It could determine how South Korea positions itself in a fast-changing, protectionist global trade order. (With inputs from the agencies)

South Korea is hastily negotiating a trade deal with the US, prompted by Japan's recent agreement that reduces tariffs and encourages investments.

South Korea rushes to match US-Japan trade deal ahead of tariff deadline