Vietnam praised the new US-Vietnam trade framework, which lowers US tariffs on many Vietnamese exports to 20% (from 46%) and adds a 40% tariff on transshipments aimed at curbing Chinese rerouting. While structural details like rules of origin remain pending, Vietnam sees this as opening the door to fairer and more balanced trade.

The US and India are racing to finalize a tariff-cutting trade agreement by July 9, following the Vietnam deal. Key sticking points are agricultural goods (GM crops, dairy), where India resists opening its market, though it’s open to reductions on walnuts, medical devices, autos, energy. Talks reportedly are nearing conclusion.

China warned it could retaliate if the US-Vietnam deal harms its interests; the pact’s 40% tariff targets Chinese goods routed through Vietnam to avoid US duties. Beijing said it’s closely examining the deal.

China’s June Caixin Services PMI fell to 50.6, the lowest in nine months, down from 51.1 in May. New export orders dropped sharply and employment growth faded, showing weaker service demand amid trade uncertainty.

The People’s Bank of China has consulted at least two European banks on managing prolonged low-rate environments, as it navigates policy rates reduced from 1.8% to 1.4% amid fears of deflation and squeezed bank profits.

BOJ board member Hajime Takata argued that the Bank of Japan should be prepared to resume interest rate hikes after a temporary pause, citing progress toward its 2% inflation target driven by strong corporate profits and labor shortages. He emphasized flexibility due to uncertainties around U.S. trade policy.

Japan’s Jibun Bank services PMI rose to 51.7 in June (from 51.0 in May), marking the third straight month above 50. New orders, employment, and business confidence improved, though export‑related services slowed. Composite PMI climbed to 51.5.

President Lee Jae‑Myung pledged on July 3 to implement bold fiscal expansion—including $14.7 billion in additional spending—after the martial law crisis. He aims to boost domestic demand while pursuing favorable trade outcomes with the U.S., amid risks of tariffs affecting sectors like semiconductors, autos, and steel.

The World Bank cut Thailand’s 2025 GDP forecast to 1.8% (from 2.9%), citing weak exports, fewer Chinese tourists, and sluggish domestic demand. It expects inflation to trend lower and predicts further monetary easing from the Bank of Thailand amid growing economic and political risks.

Indonesia plans to sign a $34 billion memorandum of understanding with U.S. partners on July 7, aiming to increase imports of U.S. fuels and boost American investment—part of efforts to secure a favorable tariff agreement before the July 9 deadline.

Deputy Prime Minister Gan Kim Yong cautioned local firms not to rely on the assumption that US tariffs will be rescinded under a future administration, signaling that long-term trade friction is possible. He urged businesses to review strategies, diversify markets, and focus on cost competitiveness.

Bangko Sentral ng Pilipinas Governor Eli Remolona said on July 3 that with inflation comfortably low, the central bank could implement two additional rate cuts later this year to support growth.