International News 11 June 2025
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Gold prices strengthen, driven by dollar weakness and US-China talks
On Monday, the price of gold increased due to a weaker US dollar, in anticipation of upcoming trade talks between the US and China. Spot gold prices rose by 0.3% to US$3,317.97 per ounce after falling earlier to US$3,293.29, the lowest level since 2 June. US gold futures declined by 0.2% to US$3,338.70 as the US dollar dropped 0.2% against major currencies, making gold more affordable for holders of other currencies. Factors such as trade tensions, geopolitical issues, debt concerns, and subdued economic growth are anticipated to underpin gold prices in the forthcoming months. US and Chinese officials are meeting to address their trade dispute, while stronger US nonfarm payroll data has reduced expectations for Federal Reserve interest rate cuts this year. The market is currently focused on upcoming US CPI data, which is expected to provide insights into the Federal Reserve's monetary policy direction.
Taiwan's exports soar to record high in May on demand for AI chips
Taiwan's exports reached an all-time high in May, with a 38.6% increase compared to the previous year, totalling US$51.74 billion. This marks the first time the export value has exceeded US$50 billion. The surge was attributed to global demand for AI technology and a rise in orders ahead of anticipated tariffs from the US. This growth exceeded economists' predictions and marked the fastest pace in almost 15 years. Additionally, Taiwan's tech companies, such as TSMC, have played a significant role as major suppliers to tech giants like Apple and Nvidia. The surge in exports can be attributed to the increased demand for chips for AI. May's export growth marked the 19th consecutive month of expansion, driven by customers accelerating orders to mitigate the impact of potential tariff hikes proposed by former US President Donald Trump.
Shipments to the US Shrink, China's Exports Grow Lower than Economist Projections
In May, China's exports grew by 5% annually, missing the initial 6% projection, with the total value reaching US$316 billion. The decrease was mainly attributed to a 34.4% decline in exports to the US, representing the most significant drop since the onset of the pandemic in February 2020. Despite a recent agreement that provided temporary relief on import duties, exports to other countries increased by 11%, including a 22% rise in exports to Vietnam. However, this has given rise to concerns about fuelling the US trade deficit with these countries, which could complicate tariff negotiations. The data also highlighted a recovery in rare earth element shipments, a contentious issue between the US and China. Overall, the challenge of meeting export expectations in the face of fluctuating global demand and trade dynamics was evident in China's export performance in May.