Despite political and policy tensions, global markets are hitting new highs with stocks rising and bonds being bought. Japan’s election outcome could impact central bank rate hikes. EU member states may use “anti-coercion” measures against U.S. services. Trump’s attacks on Powell raise questions on central bank independence. The EU’s efforts to restrict Russia’s oil revenue may not be effective. OPEC and IEA are cautious in crude oil demand forecasts.

U.S. and world economies remain strong despite looming tariff hikes, rising public debt, and Fed independence concerns. U.S. economic growth is at 2.4% with positive economic surprise indexes. Big-tech companies are reporting higher earnings than expected. S&P500 and Nasdaq hit new highs. EU warns of retaliatory measures on trade tariffs. Japanese election results impact markets.

Short and long-term Treasury yields dropped, pulling the dollar down. Fed independence concerns remain as Powell faces pressure for rate cuts. U.S. companies react to Trump’s tariffs with estimated costs over $34 billion. Events to watch include Richmond Fed survey and Powell’s remarks at the Fed conference. UK finance minister testifies before House of Lords’ Economic Affairs Committee.

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