🇺🇸🇨🇳 U.S.–China Agree to 90-Day Tariff Truce
The U.S. and China have struck a temporary trade deal, slashing tariffs for 90 days while negotiations continue. U.S. tariffs on Chinese goods will drop from 145% to 30%, while China’s tariffs on U.S. products fall to 10%. Treasury Secretary Scott Bessent called the agreement — finalized during talks in Switzerland — a “major step forward.” The deal also includes joint efforts to tackle the fentanyl crisis.
🥇 Gold Pulls Back from Record Highs on Trade Optimism
Gold prices dipped slightly following the trade breakthrough between the U.S. and China, along with softer U.S. inflation data. While gold retreated from its recent record above $3,500 per ounce, it remains up roughly 20% year-to-date. Improved geopolitical sentiment has pushed some investors back toward riskier assets, at least for now.
📉 Inflation Eases to 2.3%, Lowest Since 2021
U.S. inflation cooled in April, with both headline and core CPI rising just 0.2% — under expectations. The annual inflation rate dropped to 2.3%, its lowest level in more than three years. Grocery prices declined, and egg prices saw their biggest monthly drop since 1984. While housing remains the biggest driver of inflation, markets welcomed the news: stocks climbed and Treasury yields slipped.
🏛️ Fed’s Jefferson Warns: Tariffs Could Disrupt Inflation Progress
Federal Reserve Vice Chair Philip Jefferson acknowledged recent progress on inflation but cautioned that new tariffs could reverse that trend. While April’s CPI data came in softer than expected, Jefferson noted that sustained import taxes may temporarily push inflation higher — and possibly slow the economy. He emphasized the need for a steady hand on interest rates, calling current levels “well positioned” to respond to emerging risks.
