US President Trump hosts China's Xi Jinping at the White House this week, Xi's first visit to Washington in over a decade and their third meeting in under a year.
What's going on here?
The agenda covers trade, AI, rare earth minerals, and the war in Iran. Top of the list is a trade deal between the US and China that expires on November 10. The deal brought tariffs down from the triple-digit levels of early 2025, and a later round of talks also added a pause on China's expanded export controls on rare earths. China refines about 90% of the world's supply of these minerals, which go into everything from electric vehicles to chips.
Both sides want to extend the deal, but they can't agree on how long. Washington has floated three to six months, while Beijing reportedly wants it to run through Trump's term.
The presidents will also discuss guardrails for AI, picking up a conversation from their Beijing meeting in May. Earlier this month, Anthropic CEO Dario Amodei urged AI companies to slow work on their most powerful models so safety checks can keep up. Trump dismissed the idea, saying a slowdown would give China an advantage. AI is now a primary driver of corporate growth, so how the two countries handle their rivalry matters well beyond tech.
What's the takeaway here?
A sweeping agreement isn't expected from this particular meeting between Trump and Xi. But at a time when AI development, energy costs, and inflation are all pulling in different directions, extending the relative calm in US-China relations could count for a lot.
(For a portfolio designed to handle whatever headline comes next, see General Investing.)
In Other News: Japan’s interest rates went for a hike too
Last week, the Federal Reserve raised US rates for the first time in three years. Days later, the Bank of Japan (BoJ) did the same, lifting its benchmark rate by a quarter point to 1.25%. That's still low by global standards, but it's the highest in 31 years for a country that spent decades at zero or below. It's also the BoJ's fastest run of hikes since 1990.
乍看之下，日本似乎無需加息：8 月核心通脹放緩至 1.7%；低於日本央行 2% 目標。但這部分源於政府的能源補貼。若同時剔除食品及能源，另一項通脹指標仍維持在 1.9%。日本央行亦警告，油價上升及日圓疲弱或會進一步推高物價。
一般加息會令貨幣轉強，因為利率越高，持有該貨幣的收益就越多。但今次日圓兌美元卻不升反跌。首先，加息早已被市場消化；其次，美聯儲同樣加息，美日息差未有明顯收窄；三來，九名委員中有兩人投反對票，令交易員估計日本央行之後的加息步伐或會放慢。
（想了解更多全球利率及債券孳息的資訊，瀏覽我們最新的 CIO 投資思維。）
往績表現並不保證未來回報。本文與 Finimize 合作撰寫。
