U.S. June CPI, China's Q2 GDP and June import and export data, State Council Information Office press conference

Overview of Major Financial Events from July 14 to July 20, all in Beijing time:

Key Focus: U.S. June CPI, China's Q2 GDP, China's June import and export data.

In addition, the State Council Information Office will hold two press conferences on Monday to introduce the import and export situation and financial statistics for the first half of the year. China will release June retail sales, national real estate development investment, and other data. Trump will make an important statement on Russia on Monday, the U.S. will release June retail data, and the Federal Reserve will publish the Beige Book on economic conditions.

U.S. Releases June CPI and PPI

On Tuesday, the 15th, the U.S. will release June CPI data. On the 16th, the June PPI data will be released.

Last month, the U.S. Consumer Price Index continued its downward trend, with May CPI rising 2.4% year-on-year and core CPI rising 0.1% month-on-month, marking the fourth consecutive month below expectations.

However, the inflation pressures faced by the Federal Reserve are far from dissipated—core commodity prices are quietly rising, service sector inflation remains stubborn, and wage growth for the bottom 25% income group has even fallen below pre-pandemic levels.

Notably, on July 11, Bank of America Merrill Lynch revealed a market-overlooked inflation driver in its latest research report: rising stock prices are themselves pushing up PCE inflation. The report states that, aside from tariff factors, stock prices and broader financial asset prices influence PCE inflation through portfolio management subcategories. Since management fees are a function of fund value, a rising stock market directly pushes up the price index of this category.

Wall Street Journal reporter Nick Timiraos believes that the inflation data in the coming months will provide key tests: first, whether tariffs will push up inflation, and second, if inflation trends deviate from expectations (whether high or low), whether there will be disagreements within the Federal Reserve on response strategies. The latest Federal Reserve minutes show that most officials believe tariffs may continue to push up inflation, and patience is needed regarding interest rate adjustments.

China Releases Q2 GDP

On Tuesday, the 15th, China will release Q2 GDP data.

Last quarter's data showed that in the first quarter, China's GDP was 31.8758 trillion yuan, with a year-on-year growth of 5.4% at constant prices, and a quarter-on-quarter growth of 1.2% compared to the previous year's fourth quarter

From an industrial perspective, the added value of the primary industry was 1.1713 trillion yuan, a year-on-year increase of 3.5%; the added value of the secondary industry was 11.1903 trillion yuan, an increase of 5.9%; and the added value of the tertiary industry was 19.5142 trillion yuan, an increase of 5.3%.

At a press conference held by the State Council Information Office on the economic operation of the first quarter, Sheng Laiyun, deputy director of the National Bureau of Statistics, stated that a new pattern of China's economy relying on domestic demand and innovation-driven growth is taking shape. Over the past five years, the average contribution rate of domestic demand to economic growth has exceeded 80%. In 2024, the added value of the "three new" industries accounted for more than 18% of GDP. The added value of the core digital product industry also reached about 10% of GDP. This is conducive to enhancing the coordination and stability of the Chinese economy.

Sheng Laiyun stated, we firmly oppose the United States imposing tariff barriers and trade bullying, as such practices harm others without benefiting oneself. In the short term, the high tariffs imposed by the United States will bring certain pressure on trade and the economy, but it cannot change the overall trend of China's economy continuing to improve in the long term. China's economic foundation is stable and resilient, and we have the confidence, capability, and determination to respond to external challenges and achieve economic development goals.

China Releases June Import and Export Data

On Monday, the 14th, China released its import and export data for June. At 10 a.m. that morning, the State Council Information Office will also hold a press conference on the import and export situation for the first half of 2025.

May data showed that in May, China's imports decreased by 2.1% year-on-year in terms of renminbi, compared to a year-on-year increase of 0.8% in April. China's exports increased by 6.3% year-on-year, down from a year-on-year growth rate of 9.3% in April.

In terms of bulk commodity exports, China's rare earth exports in May surged nearly 23% month-on-month, reaching a one-year high. Automobile exports saw a month-on-month growth rate of over 12%, while integrated circuit exports fell by 2.65% month-on-month.

Guangfa Securities' Guo Lei believes that the slowdown in exports is mainly due to the drag from exports to the U.S., with the year-on-year decline in exports to the U.S. widening in May, and the uncertainty of tariffs and trade environment beginning to show. Although there were characteristics of "export rush" in early to mid-May, the trend weakened again in late May, speculating that this was due to overseas importers replenishing short-term inventories after the easing of tariffs, with unclear expectations leading to a quick release of impulses.

Song Xuetao from Guojin Securities believes that under the significant tax rate gap, there is still profit space for transshipment and going overseas. However, as inventories rise, shipping costs increase, and overall tariff levels rise, U.S. import demand has declined. Additionally, the PMI export order index for China in May and the number of container ships departing from China to the U.S. in early June also indicate that the intensity of "export rush 2.0" may begin to wane after the easing of U.S.-China tariffs in mid-May.**

China Releases June Data on Social Retail, Real Estate, and More

On Tuesday, the 15th, China released data on June's total retail sales of consumer goods, industrial added value above designated size for June, national real estate development investment from January to June, and urban fixed asset investment from January to June.

The State Council Information Office will hold a press conference at 3 PM that afternoon, where Zhou Lan, Deputy Governor of the People's Bank of China, will introduce the financial statistics for the first half of 2025 and answer questions from reporters.

Last month, the policy of replacing old consumer goods with new ones continued to show results, with China's social retail increasing by 6.4% year-on-year, the highest since December 2023, and retail sales of household appliances and audio-visual equipment growing by 53%.

CITIC Securities pointed out that the high growth in social retail in May was due to three resonating factors: the early start of mid-year promotions, the Dragon Boat Festival falling in May, and support from national subsidy funds. The two categories of national subsidy products, household appliances and audio-visual equipment, as well as tobacco, alcohol, and sports consumption, performed particularly well. However, the improvement in automotive consumption was limited, and consumption related to the real estate chain remained weak. Due to the possibility that May's consumption may have overdrawn June's momentum, coupled with weakening income expectations, CITIC Securities holds a conservative view on whether the strong social retail growth can continue, unless policies are further intensified.

From January to May, national real estate development investment saw an expanded year-on-year decline, with the sales area and sales amount of newly built commercial housing also experiencing a larger decline. By the end of May, the inventory of unsold commercial housing decreased. The decline in funds available to real estate development enterprises has expanded for four consecutive months.

In May 2025, among 70 large and medium-sized cities, the month-on-month decline in second-hand housing prices in various cities expanded, with the decline in first-tier cities increasing to 0.7%, and the decline in second and third-tier cities expanding to 0.5%; the year-on-year decline in second-hand housing prices continued to narrow. The month-on-month prices of new homes in first and second-tier cities shifted from stable to declining, with the year-on-year decline continuing to narrow.

Trump Announces Important Statement on Russia Issue on Monday

According to CCTV News, on July 10 local time, U.S. President Trump revealed that he would make a "major statement" regarding Russia next Monday (local time July 14).

During a phone interview with U.S. media that day, Trump stated that the current Russian military airstrikes on Ukraine have intensified, expressing his "disappointment" with Russian President Putin, and described Putin as "verbally polite but without substance."On the 7th local time, Trump stated at a White House dinner welcoming Israeli Prime Minister Netanyahu that the United States would supply more weapons to Ukraine to assist in its self-defense. "We will have to provide more weapons, mainly defensive weapons." Trump also said, "To be honest, I am disappointed that President Putin has not stopped."

On the 9th, Russian presidential spokesman Peskov stated that the Russian side was quite "calm" regarding President Trump's remarks, as he is known for using tough rhetoric.

U.S. Releases June Retail Data

On Thursday, the 17th, the U.S. released June retail data.

Last month's data showed that U.S. retail sales in May experienced the largest decline since March 2023, mainly due to a drop in automobile purchases. The previous value was revised from 0.1% to -0.1%. The buying spree that occurred to avoid potential price increases due to tariffs has subsided.

However, Barclays in a recent research report predicted that inflationary pressures from Trump's tariffs are expected to become significant starting in July, focusing on the back-to-school shopping season.

Barclays expects that goods subject to 30% higher tariffs will arrive at U.S. ports by the end of June or early July and will start entering stores during the back-to-school season at the end of July, thus the broader tariff-related price increase effects will begin to manifest from June to July. Although the May CPI data showed moderate performance, the price transmission effects caused by tariffs are about to emerge, with core CPI expected to rise to 3.6% due to tariffs.

Federal Reserve Releases Economic Conditions Beige Book

On Thursday, the 17th, the Federal Reserve released the Economic Conditions Beige Book.

The high uncertainty surrounding Trump's tariffs is causing a chain reaction in the U.S. economy. The previous report pointed out that costs and prices are expected to rise at a faster pace in the future, and the economic outlook remains "slightly pessimistic and uncertain." The report stated:

"All regions reported higher levels of economic and policy uncertainty, leading businesses and households to adopt a cautious and wait-and-see attitude in decision-making."

President Trump has imposed tariffs on many U.S. imported goods and threatened to impose higher tariffs on major trading partners. In the previous Beige Book, the term "tariff" appeared 122 times, compared to 107 times in the prior issue; the word "uncertainty" and its variants appeared 80 times.

Most regions described employment as "flat" and generally mentioned delays in hiring due to uncertainty. All regions noted weakened labor demand. Wages continue to grow at a "moderate" pace

Eurozone Releases June CPI

On Thursday, the Eurozone released the final value of the harmonized CPI for June.

The preliminary CPI value released at the beginning of the month showed a year-on-year increase of 2%, in line with expectations and reaching the European Central Bank's target level, up from 1.9% in May. This data provides a rationale for the ECB to pause interest rate cuts and echoes statements from several senior officials—indicating that as inflation returns to the target range, the rate-cutting cycle has entered its final stage, and any future actions will likely be minor adjustments.

Economists believe that when the ECB further lowers interest rates may depend on the pace of decline in service sector inflation. S&P Global Market Intelligence analyst Diego Iscaro told the media that the ECB is expected to remain on hold at the July meeting. He believes the ECB will cut rates twice more at the September and December meetings this year, but he noted that if core inflation does not ease in the coming months, the number of rate cuts may be in doubt.

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