Trade deals: disappointing and hopeful

plus: stablecoin moves, derivatives, ceasefires, a new Fed attack and much more

“Society is the total network of relations between human beings. The components of society are thus not human beings but relations between them.” – Arnold Toynbee ||

Hi everyone, I hope you’re all doing well! It’s good to be back at my desk and holy cow is there a lot to catch up on! No doubt I won’t get to everything below, but over the next few days I’ll have taken a stab at highlighting the key moves in the crypto/macro overlap.

Today, the priority has to be the big moves on trade, and on war, with what looks like good news all around. Not a bad start to the week, not bad at all.

IN THIS NEWSLETTER:

• Coming up: inflation, retail sales, a crypto round table and a ton of geopolitical moves

• Trade deals: disappointing and hopeful

• A new Fed attack

• Macro-Crypto Bits: markets, macro, ceasefires, stablecoins and more

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WHAT I’M WATCHING:

Coming up:

There’s a LOT going on in geopolitics this week, with some key macro drops as well:

Today, India and Pakistan’s military operations chiefs will meet to discuss the next steps in the ongoing conflict, with the ceasefire reportedly holding despite each side accusing the other of breaches.

Also today, the SEC hosts a round table titled Tokenization - Moving Assets Onchain: Where TradFi and DeFi Meet, which will feature panels with participation from both skeptics and supporters, including those from firms such as Fidelity, BlackRock, Superstate, Robinhood, Canton, Nasdaq, Invesco, Apollo, Securitize and many more. It kicks off at 1pm ET and they will probably host the stream here.

Tomorrow we get a key economic release: US CPI for April. This will be the first post-“Liberation Day” inflation reading, although any tariff pass-through will still be limited at this stage. Even so, consensus forecasts point to a notable acceleration on month-on-month readings, with year-on-year increases steady at 2.8% for core and 2.4% for the headline index.

(chart via Bloomberg)

Also tomorrow, President Trump lands in Saudi Arabia for a Middle East tour that will also include Qatar and the UAE.

On Thursday, if all goes according to plan, Russia’s President Putin will meet Ukraine’s President Zelenskyy in Türkiye. Russia will reportedly show up with the conditions laid out in its 2022 offer, while Zelenskyy is being pushed into the talks by an increasingly frustrated US President.

Also on Thursday, we get US retail sales – as with inflation, this will be the first post-tariff hard data indication of consumer strength. And there is unlikely to be much of that, with consensus forecasts suggesting no month-on-month growth at all (see chart above).

And we get the latest US Producer Price Index, which is expected to reveal building wholesale inflation pressure with solid month-on-month increases after last month’s deceleration.

What’s more, Fed Chair Jerome Powell is scheduled to speak on Thursday at an event in Washington DC.

On Friday, we get the preliminary University of Michigan Consumer Survey report for May. It probably won’t bring good news.

On Sunday, Poland goes to the polls in a general election. It looks like the moderate pro-EU candidate will win, but the far-right has been climbing in the polls (as in most of Europe) and a more polarized divide could shine an unfortunate light on the political weakening of the European Union’s foundations.

Also on Sunday, Portugal votes. The incumbent Social Democratic Party is projected to win but by too narrow a margin to govern without forming a coalition, which would have to be with the Socialist Party as all have ruled out working with the far right Chega party even though it is climbing in the polls. This is Portugal’s third election in three years, so turnout could be low.

Trade deals

We’re starting to get actual signs of progress, which is positive. Yet there are expectation pitfalls ahead.

In chronological order: