Vietnam reached trade deals with US, marking the third deal made with US after China and UK. However, concerns remained on China responses, as Trump tried to curb China’s goods via other countries e.g. Vietnam and India. On currency, weaker DXY was seen following Trump’s comment, that Powell should resign immediately. Powell, as expect, gave no comment over his tenure. Last month, ADP employment dropped for the first time in over 2yrs (curr: -33k m-m, cons: +95k m-m, prev: +29k m-m), Services employment saw deep contraction (curr: -66k m-m), driven by professional & business services (curr: -56k m-m).
From the bond market, FR 40, 84, 86, and 76, are currently the cheapest based on our yield curve model. Last national business day, the dollar index was closed at 96.78 (-0.0%). Rupiah was depreciated by 0.3% at USDIDR at 16,247. The 10yr UST yield was up by +3.5bps at 4.28% and 10yr INDOGBR was up by +1.1bps at 6.62% – the spread between the two was at 234bps.
Economy: Vietnam reached trade deals with US
Vietnam’s exports to US would be imposed 20% charge, while any goods entering US transshipped via Vietnam would be subject to 40% rates. Meanwhile, US exports to Vietnam would receive zero tariffs. Currently, Vietnam officials pushed its agenda, where US would remove restrictions on high-tech exports. Source: Bloomberg
Economy: Trump-Powell ties escalated
On his social media, Trump said that Powell should resign immediately. This action was specifically in response to earlier critiques from FHFA Director Bill Pulte, who said that Powell had lied during testimony against law. Meanwhile, on a separate occasion, Powell had no comments over questions on his tenure. If Powell decided to stay in his position until Jan’28, Trump would only have one position to fill in, which was Adriana Kugler’s seat ending on Jan’26. Source: Bloomberg
Economy: In Jun’25, US ADP Employment was below consensus (curr: -33k m-m, cons: +95k m-m, prev: +29k m-m)
The contraction was the first time since Mar’23. By industry, the downward drivers were professional & business services (curr: -56k m-m), education & health services (curr: -52k m-m), and financial activities (curr: -14k m-m). Source: ADP, Bloomberg
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