Morning Wrap - July 15, 2025

China's Economic Performance

China's GDP grew by 5.2% year-over-year in Q2 2025, slightly surpassing the forecast of 5.1%, but lower than the 5.4% recorded in Q1. The Chinese National Bureau of Statistics has acknowledged that the economy is grappling with both external and internal challenges, including global instability and unresolved structural issues.

Key Economic Indicators

• Industrial Production: Increased by 6.8% year-over-year in June, marking the fastest pace since March.
• Retail Sales: Slowed to 4.8% from 6.4% in May.
• Fixed Asset Investment: Grew by 2.8% in the first half of 2025, falling short of forecasts.

These figures indicate an uneven recovery in China's economy.

Central Bank Actions

The Chinese central bank has announced reverse repo operations worth 1.4 trillion yuan (approximately $195 billion), aimed at providing short-term liquidity with tenors of 3 and 6 months.

Meta's AI Investments

Mark Zuckerberg has announced plans for hundreds of billions of dollars in investments into AI infrastructure, including initiatives like Project Hyperion and Meta Super Intelligence Labs. Future Titaned clusters are expected to launch in 2026, with the goal of establishing Meta as a leader in superintelligence development.

Gold Price Forecast

Goldman Sachs has projected that the price of gold will reach $3,700 by the end of 2025 and $4,000 by mid-2026. This forecast is supported by strong central bank demand, particularly from China, increased ETF inflows, and ongoing geopolitical uncertainty.

U.S. Tariff Concerns

Bank of America has raised concerns that former President Trump's proposed 30% tariffs could increase the effective U.S. tariff rate by 4 percentage points. This situation may lead the Federal Reserve to delay or completely abandon planned rate cuts in 2025.

Currency and Bitcoin Movements

The U.S. dollar ended the day higher against most major currencies, driven by Trump's new threats of 30% tariffs on the EU and Mexico. Additionally, Trump has threatened 100% tariffs on Russian goods if peace is not achieved within 50 days, alongside secondary sanctions on countries purchasing Russian oil. He also introduced a new NATO defense pact with Ukraine, which includes the production of Patriot systems and the deployment of U.S. military equipment.

Bitcoin reached a record high of $123,000 before pulling back to $116,500 and stabilizing around $117,500.