European bond yields decline, analysis of short-term trends of spot gold, silver, crude oil and foreign exchange on June 10

Global Market Review

1. European and American market trends

The three major U.S. stock index futures fell, Dow futures fell 0.06%, S&P 500 futures fell 0.02%, and Nasdaq futures fell 0.03%. The German DAX index fell 0.43%, the UK FTSE 100 index rose 0.39%, the French CAC40 index fell 0.11%, and the European Stoke 50 index fell 0.22%.

2. Market news interpretation

European bond yields declined, and Sino-US trade negotiations attracted attention

⑴ On June 10, the euro zone government bond yields fell slightly on Tuesday, but they were still hovering around the previous day's level. The market paid attention to the progress of Sino-US trade negotiations on the second day. ⑵ Traders will also pay attention to the speeches of ECB officials this week, after the ECB cut interest rates by 25 basis points to 2% as expected last week, but suggests that its easing cycle may be nearing its end, exceeding some market expectations. ⑶ German 10-year government bond yield fell 3 basis points to 2.54%, as the benchmark interest rate for the euro zone. ⑷ Germany's 2-year government bond yield fell 3 basis points to 1.849%, and the 30-year government bond yield also fell to 3.006%. ⑸ Global long-term bond yields have risen sharply this year as investors' concerns about the debt levels of developed countries have increased. ⑹Nabier Mirali, portfolio manager of EdmonddeRothschild Asset Management, pointed out that the bond market volatility increased due to reduced institutional investor participation, while the number of hedge funds and "fast money" investors increased. ⑺The scale of Japanese investors selling German bonds hit a record high in more than a decade in April, after Germany's borrowing costs soared due to debt rules reforms. ⑻The yield on Italy's 10-year government bonds fell slightly to 3.487%, while the interest rate spread of German-Italian government bonds was 91.20 basis points. ⑼ European Central Bank officials who will speak this week include Executive www.xm-forex.committee member Isabel Schnabel, after www.xm-forex.comments from policymakers Peter Kazimier and Robert Holtzman supported the view that the rate hike cycle may be nearing its end. ⑽Milari believes that the European inflation trend is downward, and the final data will prompt the European Central Bank to continue to cut interest rates. ⑾ Analysts at Metzler Bank in Frankfurt expect that given the ECB's expectations of inflation reaching 1.6% next year, there is still room for downside in the short-term and long-term ends of the yield curve. ⑿In addition, the price of Japanese ultra-long-term bonds rose on Tuesday, after reports that the Japanese government was considering buying back some ultra-long-term bonds to curb the rise in yields.

People in the public health field in the United States issued a joint letter criticizing Trump for cutting funds

More than 60 current staff of the National Institutes of Health issued a joint letter on the 9th, criticizing President Donald Trump for significantly reducing scientific research funds, saying that relevant policies "endanger the health of the United States and the world", politicizing scientific research and "waste public resources." According to the Associated Press, the letter collected a total of 92 staff members who were in or recently dismissed from the National Institutes of Health, including researchers, project leaders, branch supervisors and scientific research review officials, and another 250 staff members of the National Institutes of Health expressed their support anonymously.

Italy industrial output rose unexpectedly, and signs of recovery in manufacturing began to appear

⑴ Italy's industrial output rose by 1.0% month-on-month in April, exceeding market expectations, after a Reuters survey of 16 analysts showed that it was expected to fall by 0.2%. ⑵After adjustments to working days, Italy's industrial output increased by 0.3% year-on-year in April, the first increase after a 26-month decline, after a previous expectation of a decrease of 1.4%. ⑶The Italian National Statistics Office (ISTAT) said that the month-on-month growth in April covered all industrial sectors except energy. ⑷ Industrial output in April increased by 0.4% www.xm-forex.compared with the previous three months, showing signs of gradual stability. ⑸ Paolo Pizzoli, senior economist at the Netherlands International Group (ING), said that Italian industry may be close to the bottom, but it is still difficult to determine whether it is a cyclical rebound. ⑹Bologna think tank Prometeia predicts that Italy's industrial output will increase by 0.5% month-on-month in the second quarter. ⑺The Italian National Bureau of Statistics previously expected Italy's economy to grow by 0.6% in 2025, down from the 0.8% forecast in December 2024, mainly affected by the uncertainty caused by Trump's tariff remarks. ⑻Nevertheless, the strong performance of industrial output in April and the increase in GDP data in the first quarter provide a better foundation for the annual growth of Italy's economy.

The UK issued 2038 inflation-linked government bonds

⑴ On June 10, the UK Debt Authority (DMO) announced the successful sale of 5.5 billion pounds (about 7.4 billion US dollars) of new 1.75% inflation-linked government bonds through syndication, with a maturity date ofSeptember 2038. ⑵The issuance of Treasury bonds attracted more than £61 billion orders, slightly lower than the all-time high of £67.5 billion set in March 2025. ⑶ The real yield of the government bond is 1.7449%, 11.75 basis points higher than the real yield of inflation-linked government bonds in November 2037, and is at the low end of the previous guidance range. ⑷ The actual rate of return of this issuance is lower than 2.0234% of the last inflation-linked treasury bond issuance, the highest level since the DMO issued treasury bonds through syndicate in September 2005. ⑸ British debt agencies plan to raise £299 billion this year, of which about £31 billion www.xm-forex.comes from inflation-linked Treasury bonds, and plan to raise £10.5 billion through three syndication issuances. ⑹The joint leaders of this transaction are Barclays, Citigroup, Nomura and Royal Bank of Canada.

Small business confidence in the United States rises due to expectations of the Trump spending bill

⑴ Confidence in the United States improves as tariff concerns ease and expectations that Trump's huge tax and spending bill will boost the economy. ⑵ The American Independent Enterprise Alliance (NFIB) said that the small business confidence index rose to 98.8 in May from 95.8 in April, returning to the long-term average of 98. ⑶ This rise ended a four-month trend of deteriorating confidence after a sharp decline in confidence due to uncertainty in trade policies and concerns about inflation and the labor market. ⑷ NFIB economist Bill Dunkelberg pointed out that despite the recovery of confidence in May, uncertainty among small business owners is still high. ⑸ Survey shows that nearly a quarter of the www.xm-forex.companies surveyed plan to invest capital expenditure in the next six months, which is the highest level this year, indicating that business owners have increased their confidence in the future.

Middle East crude oil benchmark prices rose due to rising demand expectations

⑴Oman, Dubai and Murban crude oil prices rose for the third consecutive trading day, following the strong trend of the global crude oil futures market, traders said market expectations for an agreement to improve fuel demand drove this trend. ⑵ Singapore’s www.xm-forex.complex refining margin averaged nearly $7 per barrel over the past 15 days, the highest level in more than a year, which could encourage refineries to process more crude oil. ⑶The market is currently relatively healthy because there was no backlog of goods last month, a trader said. ⑷ According to traders, longs may have bought June/July CFDs in the past few days to increase their long positions.

⑸ Saudi Arabia's crude oil supply to China is expected to decline slightly in July, but remains strong for the third consecutive month. ⑹ According to Saudi Aramco distribution data, Saudi Aramco will ship about 47 million barrels of crude oil to China in July, a decrease of 1 million barrels from June's allocation. ⑺A Reuters survey showed that OPEC crude oil production increased in May, despite limited growth as Iraq's production was below target to make up for previous overproduction and Saudi Arabia and the UAE's production increased by less than allowed levels.. ⑻ California's fuel imports reached its highest level in four years in May as refineries turned to traditional trading partners in Asia and used some unusual routes to make up for the shortage in the U.S. second-largest oil-consuming state.

The Japanese economy is expected to avoid recession

⑴ Nomura analysts believe that even if Trump tariffs cause the economy to slow down, the Japanese economy is still unlikely to fall into recession. ⑵The Japanese economy is currently driven mainly by the service industry, and tariffs usually suppress manufacturing. ⑶ They expect the biggest impact of tariffs on Japan's economy will occur from July to September, which may lead to an annualized decline in real GDP by 0.4% month-on-month. ⑷ After that, the Japanese economy is expected to recover at a rate close to its potential growth rate (about 0.5%). ⑸Nomura expects more stimulus measures and supplementary budgets to help economic recovery, with the focus on supporting low-income earners and reducing the cost of living while maintaining fiscal sustainability. ⑹Nomura expects Japan's real GDP growth rate to be 0.6% in 2025, 0.8% in 2026, down from 0.8% in 2024.

Japan's largest opposition party called for lowering the central bank's inflation target

⑴ Japan's largest opposition party, the Constitutional Democratic Party (CDPJ), called for lowering the Bank of Japan's inflation target on June 10 and asked for more flexibility to increase interest rates, one of its campaign promises issued for the July Senate election. ⑵In 2013, under the pressure of then Prime Minister Shinzo Abe, the Bank of Japan signed a joint statement with the government, promising to achieve the 2% inflation target "as early as possible". ⑶ Since then, the Liberal Democratic Party, Abe's ruling party, has refused to amend the statement, even if inflation exceeds the 2% target, which has sparked public dissatisfaction with rising cost of living and prompted the central bank to raise interest rates to 0.5%. ⑷ The Cadets called for amendment of the joint statement in their campaign www.xm-forex.commitments to give the Bank of Japan more flexibility, raise interest rates and reverse the trend of devaluation of the yen, which is believed to be the cause of pushing up import costs. ⑸ Catholic Democratic Party leader Yoshihiko Noda said: "We hope to set inflation targets at around zero and give some tolerance space to give the Bank of Japan more flexibility in monetary policy guidance." ⑹ Prime Minister Shigeru Ishiba's minority coalition government has lower approval ratings due to public dissatisfaction with the rising cost of living. ⑺Some analysts expect Shigeru Ishiba’s Liberal Democratic Party to suffer significant losses in the upcoming elections, which increases its chances of alliances with opposition parties such as the Cadets.

3. Trends of major currency pairs in the New York Stock Exchange before the New York Stock Exchange

Euro/USD: As of 20:26 Beijing time, the euro/USD rose, now at 1.1427, an increase of 0.05%. Before the New York Stock Exchange, the price of (EUR/USD) fluctuated at the recent intraday level, falling in early trading, relying on its EAM50 support, providing positive impetus to rebound higher, converting early losses into gains, preparing to attack the important resistance level of 1.1440, in addition to the positive signal on (RSI), the pair of currencies are along the short-term basis.A small bullish trend line trading.

GBP/USD: As of 20:26 Beijing time, GBP/USD fell and is now at 1.3505, a drop of 0.33%. Before the New York Stock Exchange, after the (GBPUSD) price reached overbought levels, falling on the last trading day with negative signals on the (RSI), the price attempted to gain positive momentum, which could help break through the key resistance of 1.3585, which continues to exist on the exchange above the EMA50 and is dominated by a major bullish trend in the short term.

Spot gold: As of 20:26 Beijing time, spot gold rose, now at 3336.81, an increase of 0.34%. Before the New York Stock Exchange, the (gold) price rose on the last trading day, reaching resistance to EMA50 again, supported by the start of positive momentum of (RSI) after it successfully unloaded some overbought conditions and was affected by support from breaking the bull trail that limited its previous short-term trading.

Spot silver: As of 20:26 Beijing time, spot silver rose, now at 36.738, an increase of 0.02%. Before the New York Stock Exchange, the (silver) price rose on the last trading day, after unloading the (RSI) overbought conditions, providing more room for more returns, with the main bullish trend dominant and trading continuously above the EMA50, representing dynamic support for maintaining bullish trends.

Crude oil market: As of 20:26 Beijing time, U.S. oil rose, now at 65.710, an increase of 0.66%. Before the New York Stock Exchange, the (crude oil) price settled above the recent intraday trading, trying to break through the key resistance level of $64.75, which prevented (RSI) from reaching overbought levels and due to the need to unload such overbought conditions, negative overlap signals began to appear in the case of bullish trends on a short-term basis and trading along a slash.

4. Institutional view

Capital Macro: The Bank of England may cut interest rates beyond expectations and is expected to drop to 3.5% next year

Capital Macro deputy chief British economist Ruth Gregory said that with employmentWith the decline in the number of people, rising unemployment and slowing wage growth, the labor market data released today further confirms our view that the Bank of England's interest rate cut will exceed market expectations, and the interest rate may drop to 3.5% next year. LSEG data shows that the market has not yet priced such a significant benchmark interest rate cut. Data shows that the vast majority of analysts expect the Bank of England to maintain interest rates of 4.25% at its meeting late this month. Gregory stressed that "the employment market has not collapsed. In fact, the layoff rate of the Labor Force Survey (LFS) or the HR1 dismissal notice (the document that must be submitted when layoffs are planned) has not risen significantly. But most indicators show that labor demand is significantly weakening."

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