The POTUS chickened out once again on his China trade showdown, signing a 90-day extension Monday after failing to meet his own August 12 deadline for a permanent deal. Both countries will keep their painful but manageable tariffs in place, which are 30-50% on Chinese goods and 10-20% on U.S. products. Rather than risk the economic chaos that nearly destroyed global markets when tariffs hit triple digits earlier this year, they decided to probably keep it in perpetuity to blindside stable trade. China quickly matched the extension, keeping rare earth minerals flowing to America while the U.S. maintains chip technology exports, essentially admitting both sides need each other too much to follow through on their threats. The move buys time for negotiations on soybeans, fentanyl cooperation, and other trade issues, but experts expect this grinding trade war to drag on for years with little real progress.

EQUITY

The Japanese main index opened the week with a record high above 41,600 points on Tuesday, involving a strong push in technology stocks. Sentiment is boosted by the extension of the US-China trade truce for another 90 days, a buffer to devastating triple-digit tariffs on Chinese goods. SoftBank Group hiked over 7% after committing $32.7 billion to OpenAI and acquiring chip designer Ampere Computing.

GOLD

Gold prices are in a convergence ahead of headline inflation data after initially falling 1.62% on Monday when President Trump clarified that gold imports would not face the previously threatened 39% tariffs. The precious metal only slightly recovered on Tuesday, trading around $3,350 per ounce as investors shifted focus to upcoming US CPI data. Meanwhile, ultra-wealthy Asian investors are increasingly engaging in direct gold trading operations, moving beyond traditional approaches.

OIL

Crude oil opened the week higher, with WTI at $64 and Brent at $66.70 per barrel, as President Trump's 90-day extension of the China tariff truce eased global demand concerns. Markets are positioning ahead of Friday's Trump-Putin summit on Ukraine, where any peace deal could eliminate the risk premium from Russian oil supply disruptions.

CURRENCY

The dollar climbed over the yen to 148.40 ahead of critical U.S. inflation data expected to show core CPI rising 0.3% in July, with traders pricing in an 89% chance of a September Fed rate cut. Any upside surprise in inflation could derail rate cut expectations, particularly if Trump's tariffs are driving up prices, tightening tension between the administration and the Federal Reserve. The Australian dollar held steady after the RBA's widely expected quarter-point rate cut.