At a World Trade Organization meeting, China emphasized that while bilateral trade talks with the US are important, multilateralism remains essential for resolving global trade issues. China highlighted the need for collective action within the WTO framework and cautioned against unilateral measures.

South Korea’s Deputy Finance Minister, Choi Ji-young, met with U.S. Treasury official Robert Kaproth on May 5 to discuss foreign exchange markets. The meeting, held on the sidelines of the 58th ADB Annual Meeting in Milan, Italy, is part of broader trade negotiations aimed at crafting a package to remove U.S. tariffs before a pause on reciprocal tariffs is lifted in July.

The South Korean won appreciated by more than 1% following reports that the U.S. and South Korea discussed foreign exchange policies. Investors interpreted the talks as a sign that the U.S. might be open to a weaker dollar, influencing currency markets across Asia.

The Bank of Japan’s recent hearings revealed mixed views from market participants on the pace of tapering its bond-buying program. While some advocate for a slower reduction to ensure market stability, others support a more aggressive approach to normalize monetary policy.

Japan is contemplating delaying its target for achieving a primary budget surplus due to economic uncertainties stemming from U.S. tariffs. The government may revise its goal to attain a surplus “around fiscal 2025 to 2026,” instead of the previously committed fiscal 2025.

Sri Lanka’s consumer price inflation rate eased to 0.8% year-on-year in April, down from 2.1% in March. The decline is attributed to falling food prices, which dropped by 5.2% in April.

Following a decisive election victory, Prime Minister Lawrence Wong announced a significant cabinet reshuffle, retaining key ministers and introducing new faces to ensure stability amid global economic uncertainties. Wong emphasized the need for experienced leadership while injecting fresh perspectives into the government.

At the WTO General Council in Geneva, China emphasized the importance of multilateralism in resolving global trade issues, while acknowledging recent bilateral talks with the US as a positive step. China urged WTO members to stabilize trade relations and adhere to international trade rules, cautioning against unilateral tariffs.

South Korea confirmed ongoing discussions with the US regarding exchange rate policies, aiming to address concerns over currency volatility and its impact on trade. The talks are part of broader efforts to stabilize financial markets amid global economic uncertainties.

The Korean won appreciated significantly following reports that South Korea and the US discussed the direction of foreign exchange policies. Investors interpreted the talks as a sign of potential US openness to a weaker dollar, influencing currency markets.

The Bank of Japan’s hearings revealed differing views among policymakers and market participants regarding the pace of bond purchase tapering. Some advocate for a cautious approach to avoid market disruptions, while others support a faster reduction to address inflation concerns.

Japan is contemplating delaying its target for achieving a primary budget surplus from fiscal 2025 to around fiscal 2025-2026, citing economic uncertainties and the impact of US tariffs. The government faces pressure to increase spending or cut taxes ahead of upcoming elections.

Sri Lanka’s consumer price index fell by 0.8% year-on-year in April, marking the fourth consecutive month of deflation. This decline is attributed to falling food prices and a stronger currency, following the country’s recovery from its worst financial crisis in decades.

Following a decisive victory in the 2025 general election, Prime Minister Lawrence Wong announced a new cabinet lineup, introducing new faces and reshuffling key positions to address emerging challenges and priorities.