China’s Ministry of Commerce will impose anti-dumping duties effective July 23 on some stainless steel products imported from the European Union, Japan, South Korea and Indonesia with some tariffs as high as 103.1%. China is the world’s largest stainless steel producer with 26.71 million tonnes of stainless steel products in 2018, up 2.4% from a year ago, according to China’s Stainless Steel Association. The country imported 1.85 million tonnes of stainless steel products last year, up 53.7% from 2017.
Germany’s finance ministry warned that manufacturing industry and exports are suffering from a slowing global economy suggesting that the industrial slowdown could be lengthy. The situation looks more optimistic on domestic demand as employment levels are still growing. The report confirms previous concerns that following Brexit and the risk of a trade war, the decade-long boom in Europe’s largest economy has come to an end. Export-led German economy is increasingly relying on domestic demand and a still-bullish services sector to sustain economic growth. Chancellor Angela Merkel said last week that the government would try to stimulate domestic demand to address concerns.
The oil market continues to be in a volatile state as U.S. sanctions on Venezuela and Iran have decreased output by more than 1.5 million barrels a day. OPEC extended a supply-cut deal into 2020 and tensions between the United States and the UK on one side and Iran on the other. Brent futures have struggled to sustain prices above $65 a barrel and slumped about 7% percent last week while U.S. Crude futures have remained below $60 a barrel in the last days. News that Iran had seized a British tanker supported prices - but futures rose less than 1 percent. The steady rise in U.S. oil output and demand worries from a prolonged Sino-U.S. trade war. The International Energy Agency recently cut its expectation for global demand through 2019 and 2020 and said it may cut it again if there are signs of further weakness especially from China.
The dollar drifted higher as expectations for deep U.S. interest rate cuts this month and heightened Middle East tensions supported safe-haven assets. The currency-market focus will be on global central bank decisions scheduled for the next two weeks, developments in U.S.-China trade negotiations and earnings data from the EU and the US. The dollar broke above 108 yen to hit its highest since Wednesday while the dollar index remained around 97.179. The euro held near critical chart support around $1.12, a break of which could lead to further losses. Markets generally expect central banks to either cut rates or keep settings accommodative, starting with the European Central Bank (ECB), which meets on Thursday followed by the Bank of Japan and then the Fed next week.