Ukraine Talks at White House Overshadow Other News and Market Developments Today – Currency Thoughts
Ukraine Talks at White House Overshadow Other News and Market Developments Today
August 18, 2025
(178) Last Friday’s Trump-Putin meeting in Anchorage produced a profound shift in the U.S. President’s position, which again aligns with the Russian viewpoint. As it has been through most of the Ukraine-Russian War, Trump again sympathizes with Putin’s objectives that does not accept the ceasefire-first approach but rather prioritizes Russian grievances against Ukraine’s legitimacy as a sovereign nation and aims to push NATO’s eastern flank to what such was prior to 1989. Ukraine President Zelensky meets Trump at the Oval Office at 1:00 local time. In high-stakes negotiations, they will be joined by other European and NATO leaders after 15:00 EDT.
Great uncertainty awaits the outcome of these talks, and financial market activity this morning has been understandably subdued as investors await clarification. A second big area of uncertainty involves Federal Reserve policy over the balance of this year. The U.S. economy is slowing, but tariff hikes have begun to infiltrate prices data in the United States and elsewhere. Minutes from the late July FOMC meeting will be published Wednesday, and the Kansas City Fed-sponsored central banking symposium in Jackson Hole, Wyoming runs Thursday through Saturday of this week. This annual event has a history of producing market-moving speeches.
The dollar opened this week with a mild upturn of 0.5% against the yen and 0.3% relative to the euro, Australian dollar and sterling. The greenback is only 0.1% firmer versus the Canadian and New Zealand currencies and unchanged vis-a-vis the Swiss franc. The ten-year U.S. Treasury yield is up three basis points. Comparable sovereign debt yields have climbed five basis points in the U.K. but dropped by two bps in Italy and a basis point each in Germany, France and Spain. There’s been scant movement today in the prices of oil or gold, but Bitcoin’s correction was extended by a further 1.5% slide.
Asian stock markets were more volatile this Monday than those in Europe or the United States. Share prices closed up 0.9% in China, 0.8% in Japan, 0.8% in India, and 0.6% in Taiwan but fell 1.5% in South Korea and 0.9% in Hong Kong. The German DAX and tech-intensive Nasdaq are 0.2% lower. The DOW is flat, and the British FTSE has ticked 0.1% higher.
This has been a typically light Monday from a data-release standpoint.
The monthly housing market index in the United States compiled by the National Association of Home Builders unexpectedly slipped a point to 32, its softest level since December 2021. Canadian housing starts, by contrast, touched their highest level in July since September 2022.
The year-on-year rise of Britain’s Rightmove house price index barely rebounded to 0.3% in August from July’s 18-month low of 0.1%.
Euroland’s trade balance took a big hit in June from tariffs. The EUR 2.8 billion seasonally adjusted surplus was down from a EUR 15 billion per month average in April and May and a first-quarter monthly average of EUR 20.5 billion. Year-on-year import growth in June of 6.8% eclipsed the 0.4% uptick in exports.
Swiss industrial production last quarter was 3.5% less than in the first quarter and down 0.1% compared to a year earlier.
Japan’s tertiary index of service sector activity rose 0.5% in June. The year-on-year advance of 3.3% compared favorably with those of 2.4% in the whole second quarter and 1.3% in 2024.
New Zealand’s service sector purchasing managers index rose 1.3 index points to a six-month high in July but remained below the 50 neutral level at 48.9.
Producer prices in the Czech Republic were 1.2% lower than a year earlier in July, their sixth on-year decline in a rows. However, in Bulgaria last month, producer prices jumped 1.4% on month and 5.3% on year (most in 20 months).
In Thailand, real GDP growth accelerated last quarter to 0.6% versus the prior quarter, but the year-on-year growth rate of 2.8% was its lowest in a year.
Copyright 2025, Larry Greenberg. All rights reserved. No secondary distribution without express permission.
Tags: Euroland trade balance, Swiss industrial production, U.S. NAHB index, White House talks today
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