REUTERS
"Trump ethics filing reveals thousands of trades tied to US corporate securities"
By Jarrett Renshaw, Lawrence Delevingne and Tom Bergin
May 14, 2026
WASHINGTON, May 14 (Reuters) - U.S. President Donald Trump disclosed a flurry of at least $220 million in financial transactions earlier this year in the securities of major U.S. companies, according to two new financial disclosure forms released on Thursday by the U.S. Office of Government Ethics.
The new reports the first three months of 2026 and reported transaction values in broad ranges rather than exact amounts, showing a cumulative value of between $220 million and around $750 million.
The purchases included securities linked to companies such as Microsoft, Meta Platforms, Oracle, Broadcom, Bank of America and Goldman Sachs, as well as trades in municipal bonds.
Examples of large purchases, valued at between $1 million and $5 million each, were an S&P 500 Index fund, Nvidia Corp. and Apple Inc.
Large sales of between $5 million and $25 million each included Microsoft, Amazon and Meta.
The filing does not always make explicit the type of security, such as whether it was a stock or a corporate bond.
The filings also do not make clear in what accounts the transactions took place or who placed the trades.
The president's assets are held in a trust controlled by his children, while some of the transactions in the new filings indicate that a broker acted as an agent.
The White House press office referred questions to the Trump Organization.
An attorney for Trump Org did not immediately respond to a request for comment.
Since returning to the White House last year, Donald Trump has repeatedly disclosed financial transactions through a series of public ethics filings, showing trades in both municipal debt and securities issued by major corporations.
The disclosure forms are required under federal ethics rules and provide only a partial snapshot of an official’s financial activity because they list transactions above $1,000 in broad value bands and do not disclose exact prices, profits or whether assets were purchased directly or through managed accounts.
The president's annual financial disclosure, a broader filing that includes business assets and income, such as golf resorts and crypto ventures, is expected in the coming months.
Reporting By Jarrett Renshaw in Washington, Lawrence Delevingne in Boston and Tom Bergin in London; Editing by Aurora Ellis
https://www.reuters.com/legal/governmen ... 026-05-14/
THE DAILY NEWS
Re: THE DAILY NEWS
RIGZONE
"Oil Surges as Supply Risks Deepen"
by Bloomberg | W. Kubzansky, A. Longley, Y. Chin
Friday, May 15, 2026
Oil climbed as US President Donald Trump left a meeting with Chinese counterpart Xi Jinping without any meaningful progress on increasing energy flows through the Strait of Hormuz, reigniting concerns that disruptions to global supplies will deepen.
West Texas Intermediate rose 4% to settle above $105 a barrel, while global benchmark Brent crude settled above $109 a barrel.
Trump said he didn't push Xi to pressure Tehran to revive the strait, offering no sign of a breakthrough in the standoff over the waterway.
China is the top buyer of Iranian crude.
Traders are focused on the "lack of concrete takeaways from the Xi-Trump meeting, particularly as it relates to any meaningful pressure on Iran," said Rebecca Babin, senior energy trader at CIBC Private Wealth Group.
"We're getting mixed rhetoric, as usual, and the market is trying to sift through it."
Disappointment over a lack of progress from the Trump-Xi meeting added to a slew of headlines this week that increased concerns over the conflict.
Traders remain on edge over a potential return to hostilities between the US and Iran after a ceasefire has proven to be fragile.
Meanwhile, flows through the critical strait are easing yet again amid reports of a ship seizure near the waterway.
Physical crude markets have also firmed again in recent days, offering a reminder of the wider supply tightness that's hitting the global oil industry.
The nearly 11-week conflict has driven global oil inventories down at a record pace, and the market will remain "severely undersupplied" until October even if hostilities end next month, the International Energy Agency said this week.
"The continued closure of the Strait of Hormuz due to the war in the Middle East has intensified energy disruptions, with growing concerns that the energy system could experience a critical breakdown if crude flows do not resume," said Bart Melek, global head of commodity strategy at TD Securities.
"Such a development could send crude into the $150 range."
WTI finished the week up more than 10% and Brent finished the week up 8%.
Brent prices settled above $100 a barrel for the fourth consecutive week.
Friday also saw a broad selloff in bond markets as concerns grew that oil flows won't normalize quickly, leading to a spike in inflation.
The ceasefire between Iran and the US has been in place since early April despite a series of flareups.
Trump recently said the truce was on "massive life support," while deriding the Iranian response to his proposal to end the war.
Both Iran and the US are blocking traffic through the waterway for global energy flows.
"Unless we see China pressuring Iran, and it look as of now they are not engaging, the US and Israel will likely be tightening measures further, which is a near-term positive to crude prices," said Dennis Kissler, senior vice president for trading at BOK Financial Securities Inc.
Oil Prices
WTI for June delivery climbed 4.2% to settle at $105.42 a barrel.
Brent for July settlement climbed 3.4% to settle at $109.26 a barrel.
Only a trickle of tankers have exited the Persian Gulf since the conflict started, sapping vital flows of energy including natural gas to global customers.
The longer-term impact of the war is also starting to crystallize.
On Friday, the United Arab Emirates said it will complete the construction of a pipeline bypassing Hormuz by next year, doubling its export capacity outside the waterway.
https://www.rigzone.com/news/wire/oil_s ... 7-article/
"Oil Surges as Supply Risks Deepen"
by Bloomberg | W. Kubzansky, A. Longley, Y. Chin
Friday, May 15, 2026
Oil climbed as US President Donald Trump left a meeting with Chinese counterpart Xi Jinping without any meaningful progress on increasing energy flows through the Strait of Hormuz, reigniting concerns that disruptions to global supplies will deepen.
West Texas Intermediate rose 4% to settle above $105 a barrel, while global benchmark Brent crude settled above $109 a barrel.
Trump said he didn't push Xi to pressure Tehran to revive the strait, offering no sign of a breakthrough in the standoff over the waterway.
China is the top buyer of Iranian crude.
Traders are focused on the "lack of concrete takeaways from the Xi-Trump meeting, particularly as it relates to any meaningful pressure on Iran," said Rebecca Babin, senior energy trader at CIBC Private Wealth Group.
"We're getting mixed rhetoric, as usual, and the market is trying to sift through it."
Disappointment over a lack of progress from the Trump-Xi meeting added to a slew of headlines this week that increased concerns over the conflict.
Traders remain on edge over a potential return to hostilities between the US and Iran after a ceasefire has proven to be fragile.
Meanwhile, flows through the critical strait are easing yet again amid reports of a ship seizure near the waterway.
Physical crude markets have also firmed again in recent days, offering a reminder of the wider supply tightness that's hitting the global oil industry.
The nearly 11-week conflict has driven global oil inventories down at a record pace, and the market will remain "severely undersupplied" until October even if hostilities end next month, the International Energy Agency said this week.
"The continued closure of the Strait of Hormuz due to the war in the Middle East has intensified energy disruptions, with growing concerns that the energy system could experience a critical breakdown if crude flows do not resume," said Bart Melek, global head of commodity strategy at TD Securities.
"Such a development could send crude into the $150 range."
WTI finished the week up more than 10% and Brent finished the week up 8%.
Brent prices settled above $100 a barrel for the fourth consecutive week.
Friday also saw a broad selloff in bond markets as concerns grew that oil flows won't normalize quickly, leading to a spike in inflation.
The ceasefire between Iran and the US has been in place since early April despite a series of flareups.
Trump recently said the truce was on "massive life support," while deriding the Iranian response to his proposal to end the war.
Both Iran and the US are blocking traffic through the waterway for global energy flows.
"Unless we see China pressuring Iran, and it look as of now they are not engaging, the US and Israel will likely be tightening measures further, which is a near-term positive to crude prices," said Dennis Kissler, senior vice president for trading at BOK Financial Securities Inc.
Oil Prices
WTI for June delivery climbed 4.2% to settle at $105.42 a barrel.
Brent for July settlement climbed 3.4% to settle at $109.26 a barrel.
Only a trickle of tankers have exited the Persian Gulf since the conflict started, sapping vital flows of energy including natural gas to global customers.
The longer-term impact of the war is also starting to crystallize.
On Friday, the United Arab Emirates said it will complete the construction of a pipeline bypassing Hormuz by next year, doubling its export capacity outside the waterway.
https://www.rigzone.com/news/wire/oil_s ... 7-article/
Re: THE DAILY NEWS
CNBC
"30-year Treasury yield tops 5.1%, highest in nearly a year"
Jeff Cox @jeff.cox.7528 @JeffCoxCNBCcom Hugh Leask Sean Conlon @SeanAustin96 Lisa Kailai Han @lisakailaihan
Published Fri, May 15 2026
U.S. Treasury yields spiked on Friday following a week of messy inflation data and as traders looked to price interest rate policy under new Federal Reserve Chair Kevin Warsh.
The yield on the 30-year bond jumped nearly 11 basis points to yield 5.121%, the highest since May 22, 2025, and nearing the highest since October 2023.
The yield on the 10-year Treasury note — the main benchmark for U.S. borrowing — surged nearly 14 basis points to 4.595%.
Meanwhile, the 2-year Treasury note yield, which tends to react in line with short-term Fed rate decisions, was close to 9 basis points higher at 4.079%.
One basis point equals 0.01%, and yields and prices move inversely to each another.
The jump in yields comes as Warsh, who was confirmed by the Senate on Wednesday, grapples with an increasingly complicated inflation picture.
President Donald Trump continues to push for interest rate cuts, even as data on consumer prices and imports shows prices ticking higher.
Reports this week showed the consumer price index inflation rate at 3.8%, its highest since May 2023.
Similarly, producer prices, which measure wholesale costs and signal pipeline inflation pressures, came in at a 6% annual rate, the highest since late-2022.
Also, the cost of imports rose by 1.9% for the month of April, and 4.2% on a 12-month basis, data published by the Bureau of Labor Statistics showed Thursday, as the conflict in the Middle East drives up energy prices, prompting importers to hike their costs.
The annual import price increase was the most since October 2022, while an 8.8% surge on export costs marked the peak since September of that year.
On top of the rough data, energy prices jumped again after President Donald Trump left China with little to show from a meeting between the U.S. leader and his Chinese counterpart, Xi Jinping.
West Texas intermediate crude, the U.S. benchmark, rose to $104.39, up $3.22 a barrel, while Brent crude, the global yardstick, hit $108.30, up $2.58 a barrel.
The bond market movements are a reminder that “inflation is still a problem ... debts and deficits matter (particularly in the UK) and sovereign bonds that are heavily owned by foreigners are now a source of funds,” Peter Boockvar, chief investment officer of One Point BFG Wealth Partners, wrote in a morning note.
“Long end rates are now in control of monetary policy,” he added.
“I wish Kevin Warsh the best ... but he will still be subject to his surrounding macro circumstances.”
Troubles in the U.S. bond market also reflected ongoing fiscal challenges in the U.S.
Though the government recorded a budget surplus of $215 billion for April — typical for the month as tax collections come in — it was 17% below the same month in 2025.
Financing problems continued to be an issue, as the $97 billion spent for interest costs on the debt was the second-highest expenditure after Social Security.
Spiking yields haven’t been an issue confined to the U.S.
German bunds jumped as well, with the 10-year yielding 3.127% and benchmark Japanese government bonds up 7 basis points to 2.69%.
UK gilts hit 4.56%, up more than 8 basis points at the 10-year level.
https://www.cnbc.com/2026/05/15/treasur ... -path.html
"30-year Treasury yield tops 5.1%, highest in nearly a year"
Jeff Cox @jeff.cox.7528 @JeffCoxCNBCcom Hugh Leask Sean Conlon @SeanAustin96 Lisa Kailai Han @lisakailaihan
Published Fri, May 15 2026
U.S. Treasury yields spiked on Friday following a week of messy inflation data and as traders looked to price interest rate policy under new Federal Reserve Chair Kevin Warsh.
The yield on the 30-year bond jumped nearly 11 basis points to yield 5.121%, the highest since May 22, 2025, and nearing the highest since October 2023.
The yield on the 10-year Treasury note — the main benchmark for U.S. borrowing — surged nearly 14 basis points to 4.595%.
Meanwhile, the 2-year Treasury note yield, which tends to react in line with short-term Fed rate decisions, was close to 9 basis points higher at 4.079%.
One basis point equals 0.01%, and yields and prices move inversely to each another.
The jump in yields comes as Warsh, who was confirmed by the Senate on Wednesday, grapples with an increasingly complicated inflation picture.
President Donald Trump continues to push for interest rate cuts, even as data on consumer prices and imports shows prices ticking higher.
Reports this week showed the consumer price index inflation rate at 3.8%, its highest since May 2023.
Similarly, producer prices, which measure wholesale costs and signal pipeline inflation pressures, came in at a 6% annual rate, the highest since late-2022.
Also, the cost of imports rose by 1.9% for the month of April, and 4.2% on a 12-month basis, data published by the Bureau of Labor Statistics showed Thursday, as the conflict in the Middle East drives up energy prices, prompting importers to hike their costs.
The annual import price increase was the most since October 2022, while an 8.8% surge on export costs marked the peak since September of that year.
On top of the rough data, energy prices jumped again after President Donald Trump left China with little to show from a meeting between the U.S. leader and his Chinese counterpart, Xi Jinping.
West Texas intermediate crude, the U.S. benchmark, rose to $104.39, up $3.22 a barrel, while Brent crude, the global yardstick, hit $108.30, up $2.58 a barrel.
The bond market movements are a reminder that “inflation is still a problem ... debts and deficits matter (particularly in the UK) and sovereign bonds that are heavily owned by foreigners are now a source of funds,” Peter Boockvar, chief investment officer of One Point BFG Wealth Partners, wrote in a morning note.
“Long end rates are now in control of monetary policy,” he added.
“I wish Kevin Warsh the best ... but he will still be subject to his surrounding macro circumstances.”
Troubles in the U.S. bond market also reflected ongoing fiscal challenges in the U.S.
Though the government recorded a budget surplus of $215 billion for April — typical for the month as tax collections come in — it was 17% below the same month in 2025.
Financing problems continued to be an issue, as the $97 billion spent for interest costs on the debt was the second-highest expenditure after Social Security.
Spiking yields haven’t been an issue confined to the U.S.
German bunds jumped as well, with the 10-year yielding 3.127% and benchmark Japanese government bonds up 7 basis points to 2.69%.
UK gilts hit 4.56%, up more than 8 basis points at the 10-year level.
https://www.cnbc.com/2026/05/15/treasur ... -path.html
Re: THE DAILY NEWS
REUTERS
"Wall Street ends lower on mounting inflation worries"
By Stephen Culp and Ragini Mathur
May 15, 2026
Summary
* Indexes down: Dow 1.07%, S&P 500 1.24%, Nasdaq 1.54%
* Trump-Xi summit produces scant results
*Jerome Powell's term as Fed chair ends
* Dexcom climbs after plans to revamp board panel with Elliott
* Microsoft gains after Bill Ackman's Pershing Square discloses stake
NEW YORK, May 15 (Reuters) - U.S. stocks retreated from artificial-intelligence-fueled record highs on Friday, as spiking crude prices ignited global inflation fears.
All three major U.S. stock indexes veered sharply lower, each shedding more than 1% as a jump in benchmark Treasury yields, reflecting surging energy prices and concerns about long-term inflation, offered an attractive alternative to higher-risk equities.
Despite the selloff, the S&P 500 logged its seventh straight weekly gain, its longest since a nine-week streak ended in December 2023.
The Nasdaq and the Dow fell on the week, with the Nasdaq snapping a six-week winning streak.
"There’s a realization that the market had gotten way ahead of itself," said Kenny Polcari, chief market strategist at Slatestone Wealth in Jupiter, Florida.
"It wasn’t paying enough attention to what the bond market and economic data is telling it."
"It was caught up in this momentum AI trade."
Crude prices surged after combative comments from U.S. President Donald Trump and Iran's Foreign Minister Abbas Araqchi raised doubts as to whether their countries' fragile truce would hold and dampened hopes that normal traffic through the crucial Strait of Hormuz would soon resume.
Trump's meeting with Chinese President Xi Jinping concluded with few tangible results, and Beijing offered no clear help toward resolving the U.S.-Iran conflict.
"It certainly was encouraging to see both countries engaging again at the highest level."
"Historically, these type of events bring about headlines outlining various commitments," said Matthew Keator, managing partner at the Keator Group, a wealth management firm in Lenox, Massachusetts.
"This week's meeting seemed like more of a reset in relations between the two countries and less short-term, quantifiable results."
The yield on 10-year Treasury notes, an indicator of global borrowing costs, touched its highest level since May 2025, when markets were reeling from Trump's "Liberation Day" tariff proclamation.
Global bond yields also jumped on growing evidence of the Iran war's widespread economic damage.
END OF POWELL ERA
Friday marks Jerome Powell's last day as U.S. Federal Reserve chair, a position he has held through the pandemic, periods of inflation, and interest rate hiking and cutting cycles.
Incoming Chair Kevin Warsh is saddled with the potential need for a rate hike if a protracted Iran war leads to sticky inflation.
"The weakness today is highlighting the concerns that the recent (inflation) numbers aren't transient, and it's hard to envision the new chair communicating anything other than a neutral policy stance at best until we see some consistent, meaningful change in the data,” Keator added.
The odds of the Fed hiking interest rates by 25 basis points in December are approaching 40%, up from 13.6% a week ago, according to CME Group's FedWatch tool.
The Dow Jones Industrial Average fell 537.29 points, or 1.07%, to 49,526.17, the S&P 500 lost 92.74 points, or 1.24%, to 7,408.50 and the Nasdaq Composite lost 410.08 points, or 1.54%, to 26,225.15.
Among the 11 major sectors in the S&P 500, energy shares jumped 2.3%.
The 10 remaining sectors lost ground, with materials and utilities suffering the steepest percentage losses.
The Philadelphia SE Semiconductor Index slid 4%, dragged lower by stocks that have benefited from the AI hyperscaler phenomenon.
Nvidia and AMD fell by 4.4% and 5.7%, respectively, while Intel dropped 6.2%.
Microsoft rose 3.1% following the disclosure of a new position in the company taken by Bill Ackman's hedge fund Pershing Square.
Dexcom jumped 6.6% following the medical device maker's announcement that it will appoint two independent directors and revamp a board committee in collaboration with activist investor Elliott Investment Management.
Ford dropped 7.5%, retreating from a near 21% surge over the last two sessions on optimism over the automaker's energy storage business.
Declining issues outnumbered advancers by a 3.88-to-1 ratio on the NYSE.
There were 128 new highs and 187 new lows on the NYSE.
On the Nasdaq, 1,121 stocks rose and 3,623 fell as declining issues outnumbered advancers by a 3.23-to-1 ratio.
The S&P 500 posted 12 new 52-week highs and 32 new lows while the Nasdaq Composite recorded 53 new highs and 151 new lows.
Volume on U.S. exchanges was 19.32 billion shares, compared with the 18.13 billion average for the full session over the last 20 trading days.
Reporting by Stephen Culp; Additional reporting by Sinead Carew in New York; Ragini Mathur and Utkarsh Hathi in Bengaluru; Editing by Rod Nickel
https://www.reuters.com/sustainability/ ... 026-05-15/
"Wall Street ends lower on mounting inflation worries"
By Stephen Culp and Ragini Mathur
May 15, 2026
Summary
* Indexes down: Dow 1.07%, S&P 500 1.24%, Nasdaq 1.54%
* Trump-Xi summit produces scant results
*Jerome Powell's term as Fed chair ends
* Dexcom climbs after plans to revamp board panel with Elliott
* Microsoft gains after Bill Ackman's Pershing Square discloses stake
NEW YORK, May 15 (Reuters) - U.S. stocks retreated from artificial-intelligence-fueled record highs on Friday, as spiking crude prices ignited global inflation fears.
All three major U.S. stock indexes veered sharply lower, each shedding more than 1% as a jump in benchmark Treasury yields, reflecting surging energy prices and concerns about long-term inflation, offered an attractive alternative to higher-risk equities.
Despite the selloff, the S&P 500 logged its seventh straight weekly gain, its longest since a nine-week streak ended in December 2023.
The Nasdaq and the Dow fell on the week, with the Nasdaq snapping a six-week winning streak.
"There’s a realization that the market had gotten way ahead of itself," said Kenny Polcari, chief market strategist at Slatestone Wealth in Jupiter, Florida.
"It wasn’t paying enough attention to what the bond market and economic data is telling it."
"It was caught up in this momentum AI trade."
Crude prices surged after combative comments from U.S. President Donald Trump and Iran's Foreign Minister Abbas Araqchi raised doubts as to whether their countries' fragile truce would hold and dampened hopes that normal traffic through the crucial Strait of Hormuz would soon resume.
Trump's meeting with Chinese President Xi Jinping concluded with few tangible results, and Beijing offered no clear help toward resolving the U.S.-Iran conflict.
"It certainly was encouraging to see both countries engaging again at the highest level."
"Historically, these type of events bring about headlines outlining various commitments," said Matthew Keator, managing partner at the Keator Group, a wealth management firm in Lenox, Massachusetts.
"This week's meeting seemed like more of a reset in relations between the two countries and less short-term, quantifiable results."
The yield on 10-year Treasury notes, an indicator of global borrowing costs, touched its highest level since May 2025, when markets were reeling from Trump's "Liberation Day" tariff proclamation.
Global bond yields also jumped on growing evidence of the Iran war's widespread economic damage.
END OF POWELL ERA
Friday marks Jerome Powell's last day as U.S. Federal Reserve chair, a position he has held through the pandemic, periods of inflation, and interest rate hiking and cutting cycles.
Incoming Chair Kevin Warsh is saddled with the potential need for a rate hike if a protracted Iran war leads to sticky inflation.
"The weakness today is highlighting the concerns that the recent (inflation) numbers aren't transient, and it's hard to envision the new chair communicating anything other than a neutral policy stance at best until we see some consistent, meaningful change in the data,” Keator added.
The odds of the Fed hiking interest rates by 25 basis points in December are approaching 40%, up from 13.6% a week ago, according to CME Group's FedWatch tool.
The Dow Jones Industrial Average fell 537.29 points, or 1.07%, to 49,526.17, the S&P 500 lost 92.74 points, or 1.24%, to 7,408.50 and the Nasdaq Composite lost 410.08 points, or 1.54%, to 26,225.15.
Among the 11 major sectors in the S&P 500, energy shares jumped 2.3%.
The 10 remaining sectors lost ground, with materials and utilities suffering the steepest percentage losses.
The Philadelphia SE Semiconductor Index slid 4%, dragged lower by stocks that have benefited from the AI hyperscaler phenomenon.
Nvidia and AMD fell by 4.4% and 5.7%, respectively, while Intel dropped 6.2%.
Microsoft rose 3.1% following the disclosure of a new position in the company taken by Bill Ackman's hedge fund Pershing Square.
Dexcom jumped 6.6% following the medical device maker's announcement that it will appoint two independent directors and revamp a board committee in collaboration with activist investor Elliott Investment Management.
Ford dropped 7.5%, retreating from a near 21% surge over the last two sessions on optimism over the automaker's energy storage business.
Declining issues outnumbered advancers by a 3.88-to-1 ratio on the NYSE.
There were 128 new highs and 187 new lows on the NYSE.
On the Nasdaq, 1,121 stocks rose and 3,623 fell as declining issues outnumbered advancers by a 3.23-to-1 ratio.
The S&P 500 posted 12 new 52-week highs and 32 new lows while the Nasdaq Composite recorded 53 new highs and 151 new lows.
Volume on U.S. exchanges was 19.32 billion shares, compared with the 18.13 billion average for the full session over the last 20 trading days.
Reporting by Stephen Culp; Additional reporting by Sinead Carew in New York; Ragini Mathur and Utkarsh Hathi in Bengaluru; Editing by Rod Nickel
https://www.reuters.com/sustainability/ ... 026-05-15/
Re: THE DAILY NEWS
REUTERS
"Trump leaves Beijing with few wins but warm words for Xi"
By Trevor Hunnicutt, Antoni Slodkowski and Mei Mei Chu
May 14, 2026
Summary
* China offers no clear help on Iran war, airs frustration
* Xi to visit U.S. in the fall
* U.S. officials tout deal on farm goods, details scant
* Boeing shares slump after orders missed expectations
* Xi issues stark warning on Taiwan in closed-door talks
BEIJING, May 15 (Reuters) - U.S. President Donald Trump left China on Friday with no major breakthroughs on trade or tangible help from Beijing to end the Iran war, despite two days spent heaping praise on his host, Xi Jinping.
Trump's visit to America's main strategic and economic rival, the first by a U.S. president since his last trip in 2017, had aimed for concrete results to lift his sagging approval ratings before the November midterm elections.
Xi will visit the U.S. in the fall at Trump's invitation, China's Foreign Minister Wang Yi said.
The summit was filled with pageantry, from goose-stepping soldiers to tours of a secret garden.
But behind closed doors, Xi issued a stark warning to Trump that any mishandling of China's top concern, Taiwan, could spiral into conflict.
During a huddle with reporters on the way back to the U.S., Trump said Xi told him he opposed Taiwan's independence.
"I heard him out."
"I didn't make a comment ..."
"I made no commitment either way," said Trump.
He added that he will decide on a pending arms sale to Taiwan shortly, after speaking to "the person that right now is ... running Taiwan."
It was unclear if Trump was referring to Taiwan's president, Lai Ching-te.
A direct conversation between a sitting U.S. president and Taiwan's leader would be unprecedented in the period since Washington shifted diplomatic recognition to Beijing from Taipei in 1979, and would likely anger China, which sees the democratically governed island as its own territory.
While Trump searched for immediate business wins, such as a deal to sell Boeing jets that did not impress investors, Xi talked up a long-term reset and pact to maintain stable trade ties with Washington, underscoring their differing priorities.
Xi pushed a new term by describing the relationship as “constructive strategic stability” – a sharp departure from the framing of “strategic competition” used by former U.S. President Joe Biden, which Beijing disliked.
“Until now, China hasn't proposed an alternative - now they have - if the U.S. side agrees, that is progress,” said Da Wei, director of the Center for International Security and Strategy at Tsinghua University in Beijing.
NO HELP ON IRAN
A brief U.S. summary of Thursday's talks highlighted what the White House called the leaders' shared desire to reopen the Strait of Hormuz off Iran, and Xi's interest in American oil purchases to pare its dependence on the Middle East.
But just before the leaders met for tea on Friday, China's foreign ministry issued a blunt statement that supported efforts to reach a peace deal but said the conflict should never have happened and had no reason to continue.
At Zhongnanhai, Trump said the leaders had discussed Iran and felt "very similar", though Xi did not comment.
On the flight back home, Trump added that he wasn't "asking for any favors" on Iran.
"What's notable is that there's no Chinese commitment to do anything specific with regards to Iran," said Patricia Kim, a foreign policy fellow at the Brookings Institution.
BOEING SHARES SLIDE ON UNDERWHELMING DEAL
In another sign of a diminished scale of the summit, Trump’s readout did not mention the broad structural reforms on which previous presidents pressed Xi.
Unlike his previous trip in 2017, Trump did not discuss “structural reforms,” “global economic governance” or the “international trading system” with Xi, according to the readout.
Even the deal touted as the biggest single deliverable from the meetings underwhelmed.
Boeing stock fell 4% when Trump said on Thursday that China would buy 200 Boeing jets, significantly fewer than the roughly 500 that sources told Reuters had been under discussion.
He later added that the order could go up to 750 planes "if they do a good job with the 200."
China and the U.S. agreed to establish a Board of Trade and Board of Investment to resolve concerns over market access for agricultural products and expand trade "under a reciprocal tariff-reduction framework,” Wang said according to a statement released by his ministry.
The expected move aims to reduce tariffs on non-sensitive goods that can be traded without crossing national security red lines.
Both sides were expected to identify $30 billion of goods.
The agreement marks a shift away from U.S. demands that Beijing change its state-directed economic model and toward numerical trading targets in non-strategic sectors while keeping in place broad tariffs and export controls on sensitive technologies.
U.S. officials said they had agreed deals to sell farm goods, but there were scant details and no signs of a breakthrough on selling Nvidia's advanced H200 AI chips to China, despite CEO Jensen Huang's dramatic last-minute addition to the trip.
Trump left without official resolution to the rare earths supply problem that has dogged ties since China imposed export controls on the vital minerals in response to Trump's tariff barrage in April 2025.
While the leaders struck a truce last October for Washington to lower tariffs in exchange for China keeping rare earths flowing, Beijing's controls have caused shortages for U.S. chipmakers and aerospace companies.
When asked if the two sides extended the truce beyond later this year, Trump said he and Xi "did not discuss tariffs."
Such an extension would be "the most basic benchmark" for the success of the summit, said Brookings' Kim.
Xi's remarks to Trump that mishandling Taiwan could lead to conflict delivered a sharp warning during a summit that otherwise appeared friendly and relaxed.
Taiwan, 50 miles (80 km) off China's coast, has long been a flashpoint in ties, with Beijing refusing to rule out use of military force to gain control of the island and the U.S. bound by law to provide it the means of self-defense.
"U.S. policy on the issue of Taiwan is unchanged as of today," Secretary of State Marco Rubio told NBC News.
Reporting by Trevor Hunnicutt, Liz Lee, Antoni Slodkowski and Mei Mei Chu in Beijing; Ben Blanchard in Taipei; Writing by David Brunnstrom, John Geddie and David Morgan; Editing by Alistair Bell, Lincoln Feast, Clarence Fernandez and Deepa Babington
https://www.reuters.com/world/china/tru ... 026-05-14/
"Trump leaves Beijing with few wins but warm words for Xi"
By Trevor Hunnicutt, Antoni Slodkowski and Mei Mei Chu
May 14, 2026
Summary
* China offers no clear help on Iran war, airs frustration
* Xi to visit U.S. in the fall
* U.S. officials tout deal on farm goods, details scant
* Boeing shares slump after orders missed expectations
* Xi issues stark warning on Taiwan in closed-door talks
BEIJING, May 15 (Reuters) - U.S. President Donald Trump left China on Friday with no major breakthroughs on trade or tangible help from Beijing to end the Iran war, despite two days spent heaping praise on his host, Xi Jinping.
Trump's visit to America's main strategic and economic rival, the first by a U.S. president since his last trip in 2017, had aimed for concrete results to lift his sagging approval ratings before the November midterm elections.
Xi will visit the U.S. in the fall at Trump's invitation, China's Foreign Minister Wang Yi said.
The summit was filled with pageantry, from goose-stepping soldiers to tours of a secret garden.
But behind closed doors, Xi issued a stark warning to Trump that any mishandling of China's top concern, Taiwan, could spiral into conflict.
During a huddle with reporters on the way back to the U.S., Trump said Xi told him he opposed Taiwan's independence.
"I heard him out."
"I didn't make a comment ..."
"I made no commitment either way," said Trump.
He added that he will decide on a pending arms sale to Taiwan shortly, after speaking to "the person that right now is ... running Taiwan."
It was unclear if Trump was referring to Taiwan's president, Lai Ching-te.
A direct conversation between a sitting U.S. president and Taiwan's leader would be unprecedented in the period since Washington shifted diplomatic recognition to Beijing from Taipei in 1979, and would likely anger China, which sees the democratically governed island as its own territory.
While Trump searched for immediate business wins, such as a deal to sell Boeing jets that did not impress investors, Xi talked up a long-term reset and pact to maintain stable trade ties with Washington, underscoring their differing priorities.
Xi pushed a new term by describing the relationship as “constructive strategic stability” – a sharp departure from the framing of “strategic competition” used by former U.S. President Joe Biden, which Beijing disliked.
“Until now, China hasn't proposed an alternative - now they have - if the U.S. side agrees, that is progress,” said Da Wei, director of the Center for International Security and Strategy at Tsinghua University in Beijing.
NO HELP ON IRAN
A brief U.S. summary of Thursday's talks highlighted what the White House called the leaders' shared desire to reopen the Strait of Hormuz off Iran, and Xi's interest in American oil purchases to pare its dependence on the Middle East.
But just before the leaders met for tea on Friday, China's foreign ministry issued a blunt statement that supported efforts to reach a peace deal but said the conflict should never have happened and had no reason to continue.
At Zhongnanhai, Trump said the leaders had discussed Iran and felt "very similar", though Xi did not comment.
On the flight back home, Trump added that he wasn't "asking for any favors" on Iran.
"What's notable is that there's no Chinese commitment to do anything specific with regards to Iran," said Patricia Kim, a foreign policy fellow at the Brookings Institution.
BOEING SHARES SLIDE ON UNDERWHELMING DEAL
In another sign of a diminished scale of the summit, Trump’s readout did not mention the broad structural reforms on which previous presidents pressed Xi.
Unlike his previous trip in 2017, Trump did not discuss “structural reforms,” “global economic governance” or the “international trading system” with Xi, according to the readout.
Even the deal touted as the biggest single deliverable from the meetings underwhelmed.
Boeing stock fell 4% when Trump said on Thursday that China would buy 200 Boeing jets, significantly fewer than the roughly 500 that sources told Reuters had been under discussion.
He later added that the order could go up to 750 planes "if they do a good job with the 200."
China and the U.S. agreed to establish a Board of Trade and Board of Investment to resolve concerns over market access for agricultural products and expand trade "under a reciprocal tariff-reduction framework,” Wang said according to a statement released by his ministry.
The expected move aims to reduce tariffs on non-sensitive goods that can be traded without crossing national security red lines.
Both sides were expected to identify $30 billion of goods.
The agreement marks a shift away from U.S. demands that Beijing change its state-directed economic model and toward numerical trading targets in non-strategic sectors while keeping in place broad tariffs and export controls on sensitive technologies.
U.S. officials said they had agreed deals to sell farm goods, but there were scant details and no signs of a breakthrough on selling Nvidia's advanced H200 AI chips to China, despite CEO Jensen Huang's dramatic last-minute addition to the trip.
Trump left without official resolution to the rare earths supply problem that has dogged ties since China imposed export controls on the vital minerals in response to Trump's tariff barrage in April 2025.
While the leaders struck a truce last October for Washington to lower tariffs in exchange for China keeping rare earths flowing, Beijing's controls have caused shortages for U.S. chipmakers and aerospace companies.
When asked if the two sides extended the truce beyond later this year, Trump said he and Xi "did not discuss tariffs."
Such an extension would be "the most basic benchmark" for the success of the summit, said Brookings' Kim.
Xi's remarks to Trump that mishandling Taiwan could lead to conflict delivered a sharp warning during a summit that otherwise appeared friendly and relaxed.
Taiwan, 50 miles (80 km) off China's coast, has long been a flashpoint in ties, with Beijing refusing to rule out use of military force to gain control of the island and the U.S. bound by law to provide it the means of self-defense.
"U.S. policy on the issue of Taiwan is unchanged as of today," Secretary of State Marco Rubio told NBC News.
Reporting by Trevor Hunnicutt, Liz Lee, Antoni Slodkowski and Mei Mei Chu in Beijing; Ben Blanchard in Taipei; Writing by David Brunnstrom, John Geddie and David Morgan; Editing by Alistair Bell, Lincoln Feast, Clarence Fernandez and Deepa Babington
https://www.reuters.com/world/china/tru ... 026-05-14/
Re: THE DAILY NEWS
REUTERS
"Motor vehicles, AI boost US manufacturing production; supply shortages from war loom"
By Lucia Mutikani
May 15, 2026
Summary
* Manufacturing production increases 0.6% in April, largest gain in more than a year
* Motor vehicle production surges 3.7%; factory production rises 0.3% excluding autos
* Supply constraints because of war with Iran could slow momentum
WASHINGTON, May 15 (Reuters) - U.S. factory production posted its largest increase in 14 months in April, driven by motor vehicles and demand for technology goods amid an artificial intelligence spending boom, but supply disruptions from the war with Iran cast a shadow over the manufacturing sector.
Those constraints were flagged by a survey from the New York Federal Reserve on Friday showing delivery performance by suppliers in New York state deteriorated in May.
The U.S.-Israeli conflict with Iran has disrupted shipping in the Strait of Hormuz, raising energy prices, as well as straining global supply chains and causing shortages of a wide range of goods, including fertilizers, aluminum and consumer products.
Producer prices increased at their fastest pace in four years in April.
Oil prices jumped on Friday after comments from President Donald Trump and Iran's foreign minister dented hopes of a deal to end ship attacks and seizures around the Strait.
"Overall, firmer demand and continued expansion in output point to some resilience in the manufacturing sector," said Michael Gapen, chief economist at Morgan Stanley.
"However, uncertainty around supply and prices leaves risks to the near-term outlook tilted to the downside."
Manufacturing output increased 0.6% last month, the largest rise since February 2025, after an upwardly revised 0.1% gain in March, the Federal Reserve said.
Economists polled by Reuters had forecast production at factories rebounding 0.2% after a previously reported 0.1% dip in March.
Factory production advanced 1.3% on a year-over-year basis in April.
Motor vehicle and parts output jumped 3.7%.
Production at high-technology industries increased 1.0% after rising 0.5% in March.
Output was boosted by computers and peripheral equipment, which increased 1.5% for a second straight month.
Production of semiconductors and related electronic components rose 1.0% while that of communications equipment increased 0.6%.
Businesses are rapidly adopting AI, investing billions of dollars, and helping to prop up manufacturing, which accounts for 9.4% of the economy.
AI spending contributed significantly to the economy's 2.0% annualized growth pace in the first quarter.
Excluding high-technology industries and motor vehicles, manufacturing rose 0.3% in April after a similar gain in March.
Durable goods production shot up 1.2% last month.
But output of nondurable goods eased 0.1%, with chemicals falling 0.9%.
Production of plastics and rubber products also dropped 0.9%.
Output of petroleum and coal products, however, increased 1.0% for a second straight month.
Production also rose for food, beverage and tobacco products.
Some of the increase in manufacturing production could be related to businesses front-loading orders to avoid potential shortages and higher prices from the Middle East conflict.
SUPPLIER DELIVERY PERFORMANCE DETERIORATING
The New York Fed's Empire State Manufacturing Survey showed its measure of general business conditions increased nine points to 19.6 in May, the highest level in more than four years, with new orders and shipments rising considerably for the second straight month.
But the survey's measure of delivery time hit a four-year high while its gauge of supply availability remained negative, which it said suggested "delivery times were much longer and supply availability worsened."
U.S. stocks were trading lower as inflation worries intensified.
Longer-dated Treasury yields climbed to their highest levels in a year.
The dollar rose against a basket of currencies.
Higher oil prices and the accompanying inflation have led financial markets to expect the U.S. central bank would keep its benchmark overnight interest rate in the 3.50%-3.75% range into next year.
Elevated interest rates could offset some of the boost to manufacturing from tax cuts.
Manufacturing was hammered last year by Trump's sweeping import tariffs, though the AI spending spree cushioned some of the drag from higher duties.
Mining output dipped 0.1% last month after declining 1.6% in March, the Fed report showed.
Energy production rebounded 1.0%, though oil and gas well drilling decreased for a second consecutive month.
The Fed's Beige Book report last month noted "many producers remained cautious about increasing drilling due to uncertainty about the persistence of higher prices."
"That second consecutive decline, despite higher oil prices, should serve as a reality check to anyone hoping that a surge in U.S. production will help to offset supply losses from the Middle East," said Stephen Brown, chief North America economist at Capital Economics.
Utilities production increased 1.9%, with gains in both electric and natural gas.
Utilities output fell 1.4% in March.
Overall industrial production advanced 0.7% after an upwardly revised 0.3% drop in March.
Industrial output was previously reported to have declined 0.5%.
It increased 1.4% on a year-over-year basis in April.
Capacity utilization for the industrial sector, a measure of how fully firms are using their resources, climbed to 76.1% from 75.7% in March.
It is 3.3 percentage points below its 1972–2025 average.
The operating rate for the manufacturing sector increased 0.4 percentage point to 75.8%.
It is 2.4 percentage points below its long-run average.
Reporting by Lucia Mutikani; Editing by Chizu Nomiyama and Nick Zieminski
https://www.reuters.com/business/autos- ... 026-05-15/
"Motor vehicles, AI boost US manufacturing production; supply shortages from war loom"
By Lucia Mutikani
May 15, 2026
Summary
* Manufacturing production increases 0.6% in April, largest gain in more than a year
* Motor vehicle production surges 3.7%; factory production rises 0.3% excluding autos
* Supply constraints because of war with Iran could slow momentum
WASHINGTON, May 15 (Reuters) - U.S. factory production posted its largest increase in 14 months in April, driven by motor vehicles and demand for technology goods amid an artificial intelligence spending boom, but supply disruptions from the war with Iran cast a shadow over the manufacturing sector.
Those constraints were flagged by a survey from the New York Federal Reserve on Friday showing delivery performance by suppliers in New York state deteriorated in May.
The U.S.-Israeli conflict with Iran has disrupted shipping in the Strait of Hormuz, raising energy prices, as well as straining global supply chains and causing shortages of a wide range of goods, including fertilizers, aluminum and consumer products.
Producer prices increased at their fastest pace in four years in April.
Oil prices jumped on Friday after comments from President Donald Trump and Iran's foreign minister dented hopes of a deal to end ship attacks and seizures around the Strait.
"Overall, firmer demand and continued expansion in output point to some resilience in the manufacturing sector," said Michael Gapen, chief economist at Morgan Stanley.
"However, uncertainty around supply and prices leaves risks to the near-term outlook tilted to the downside."
Manufacturing output increased 0.6% last month, the largest rise since February 2025, after an upwardly revised 0.1% gain in March, the Federal Reserve said.
Economists polled by Reuters had forecast production at factories rebounding 0.2% after a previously reported 0.1% dip in March.
Factory production advanced 1.3% on a year-over-year basis in April.
Motor vehicle and parts output jumped 3.7%.
Production at high-technology industries increased 1.0% after rising 0.5% in March.
Output was boosted by computers and peripheral equipment, which increased 1.5% for a second straight month.
Production of semiconductors and related electronic components rose 1.0% while that of communications equipment increased 0.6%.
Businesses are rapidly adopting AI, investing billions of dollars, and helping to prop up manufacturing, which accounts for 9.4% of the economy.
AI spending contributed significantly to the economy's 2.0% annualized growth pace in the first quarter.
Excluding high-technology industries and motor vehicles, manufacturing rose 0.3% in April after a similar gain in March.
Durable goods production shot up 1.2% last month.
But output of nondurable goods eased 0.1%, with chemicals falling 0.9%.
Production of plastics and rubber products also dropped 0.9%.
Output of petroleum and coal products, however, increased 1.0% for a second straight month.
Production also rose for food, beverage and tobacco products.
Some of the increase in manufacturing production could be related to businesses front-loading orders to avoid potential shortages and higher prices from the Middle East conflict.
SUPPLIER DELIVERY PERFORMANCE DETERIORATING
The New York Fed's Empire State Manufacturing Survey showed its measure of general business conditions increased nine points to 19.6 in May, the highest level in more than four years, with new orders and shipments rising considerably for the second straight month.
But the survey's measure of delivery time hit a four-year high while its gauge of supply availability remained negative, which it said suggested "delivery times were much longer and supply availability worsened."
U.S. stocks were trading lower as inflation worries intensified.
Longer-dated Treasury yields climbed to their highest levels in a year.
The dollar rose against a basket of currencies.
Higher oil prices and the accompanying inflation have led financial markets to expect the U.S. central bank would keep its benchmark overnight interest rate in the 3.50%-3.75% range into next year.
Elevated interest rates could offset some of the boost to manufacturing from tax cuts.
Manufacturing was hammered last year by Trump's sweeping import tariffs, though the AI spending spree cushioned some of the drag from higher duties.
Mining output dipped 0.1% last month after declining 1.6% in March, the Fed report showed.
Energy production rebounded 1.0%, though oil and gas well drilling decreased for a second consecutive month.
The Fed's Beige Book report last month noted "many producers remained cautious about increasing drilling due to uncertainty about the persistence of higher prices."
"That second consecutive decline, despite higher oil prices, should serve as a reality check to anyone hoping that a surge in U.S. production will help to offset supply losses from the Middle East," said Stephen Brown, chief North America economist at Capital Economics.
Utilities production increased 1.9%, with gains in both electric and natural gas.
Utilities output fell 1.4% in March.
Overall industrial production advanced 0.7% after an upwardly revised 0.3% drop in March.
Industrial output was previously reported to have declined 0.5%.
It increased 1.4% on a year-over-year basis in April.
Capacity utilization for the industrial sector, a measure of how fully firms are using their resources, climbed to 76.1% from 75.7% in March.
It is 3.3 percentage points below its 1972–2025 average.
The operating rate for the manufacturing sector increased 0.4 percentage point to 75.8%.
It is 2.4 percentage points below its long-run average.
Reporting by Lucia Mutikani; Editing by Chizu Nomiyama and Nick Zieminski
https://www.reuters.com/business/autos- ... 026-05-15/
Re: THE DAILY NEWS
REUTERS
"US debt load could undercut Warsh's plan to shrink Fed balance sheet"
By Howard Schneider
May 15, 2026
Summary
* Warsh's plan could be complicated by rising US debt, waning appeal of bonds
* Smaller Fed balance sheet could mean higher interest rates
* Fed still lacks framework for 'quantitative easing,' tightening
WASHINGTON, May 15 (Reuters) - Incoming Federal Reserve chief Kevin Warsh's plans to shrink the U.S. central bank's "footprint" in financial markets could be constrained by rising federal debt and the potentially lost luster of U.S. Treasuries, analysts said, with rising long-term interest rates a sign of the challenge awaiting the new Fed chair.
Yields on U.S. Treasury bonds headed higher on Friday, with interest on the 2-year bond, a rough proxy for monetary policy, up more than half a percentage point, to more than 4%, since the start of the U.S. war with Iran raised new inflation concerns.
The interest rate on the 30-year bond topped 5.1%, a level not seen on a persistent basis since before the 2007 to 2009 financial crisis and recession ushered in an era of easy monetary policy and cheap borrowing costs that may be at an end.
Investors in contracts tied to the Fed's policy rate now see the Warsh Fed hiking rates as soon as January, with yields on inflation-linked securities also rising in a particularly troublesome sign for the Fed if it continues.
Warsh, who was confirmed by the U.S. Senate on Wednesday to replace Fed Chair Jerome Powell, has advocated for a smaller central bank role and less market intervention as part of a return to a more conventional monetary policy style that he feels can stay better focused on controlling inflation and avoid distorting markets.
However attractive in theory, the approach could also reveal gaps in the market for Treasuries that would either push up long-term interest rates to the detriment of businesses, households and the government itself, or put pressure on the Fed to step in and help hold borrowing costs down, said Hanno Lustig, a finance professor at Stanford University's Graduate School of Business.
Lustig's recent research has suggested top developed markets like the U.S. have lost their "convenience yield," effectively a lowered rate on government debt for countries with risk-free standing and independent central banks.
If Warsh and other Fed officials "want to get ahead of this, when yields are responding to fiscal shocks, they have to ... be transparent about that, rather than say 'Oh, this is a hiccup in the Treasury market,'" that requires the Fed to buy bonds to smooth market functioning, Lustig said on the sidelines of a recent conference at Stanford's Hoover Institution.
"In order to have real price discovery in the Treasury market, we need a central bank that will not intervene."
Warsh has been critical since his days as a Fed governor more than a decade ago of how the central bank has expanded its balance sheet during crises, or even in times of bank funding market stress, without clear guidelines on what securities it should buy, in what quantities, or a clear plan for reducing holdings afterward.
Instead, its holdings have grown and fallen through a combination of financial dark arts - probing to see just how much liquidity the banking system needs before interest rates start rising - and throw-everything-against-the-wall reactions to events like the COVID-19 pandemic or the 2007-2009 recession and financial crisis.
The Fed currently holds about $6.7 trillion in assets, down from a peak of around $9 trillion in 2022, and the amount is again growing slowly to keep bank reserves flush.
There's still no broad agreement about how Fed bond purchases, a process known as "quantitative easing," affect the economy.
The U.S. central bank usually confines its monetary policy decisions to raising and lowering a short-term interest rate that influences consumer and business borrowing costs.
Higher rates cut into spending when inflation is rising, and lower rates encourage spending during economic weakness.
Once its policy rate hits zero and can go no lower, however, as it has during economic shocks, the Fed can use its theoretically unlimited balance sheet - its power to create money - to intervene.
The assets it buys leave the system and are replaced with cash, which helps lower longer-term rates even further to encourage spending and boost growth.
OTHER COMPLICATIONS
Fed policymakers and others generally agree that it works, at least to some degree.
But "they're overdue for a discussion around how they use the balance sheet and under what circumstances," said Ellen Meade, a former top Fed adviser who is now an economics professor at Duke University.
"That's a nine-to-12-month process, with staff memos and briefings, committee discussions and then agreement."
If the aim is to both reduce holdings and hold down rates, however, it also might require closer-than-usual coordination with the U.S. Treasury, whose debt-issuance decisions could influence rates as the Fed cuts its holdings.
In a recent analysis, Bill Nelson, a former Fed staffer and now the chief economist at the Bank Policy Institute, said if the U.S. central bank used regulatory and other changes to reduce its balance sheet by another $2 trillion, the effect on its policy rate would depend heavily on how that was engineered and how the Treasury Department reacted - ranging anywhere from a 0.84-percentage-point rate cut to a possible hike.
Not everyone sees a big balance sheet as the problem Warsh believes it is.
Fed Governor Christopher Waller, noting that a main reason for large central bank asset holdings is to provide ample liquidity for banks, said proposals to curtail those holdings to the point where financial institutions compete for reserves would be "extremely inefficient and stupid."
In a recent Brookings Institution survey of top Fed and economic analysts, most of the 29 respondents said the size of the Fed's balance sheet "does not currently pose a problem for the growth or financial stability of the U.S. economy."
Beyond those issues, the broader debt dynamics could make it even tougher as Warsh takes over.
The Congressional Budget Office estimates a federal deficit equal to 5.8% of gross domestic product for fiscal year 2026 versus a 50-year average of 3.8%, with rising interest costs driving it higher.
Research from the St. Louis Fed also concluded that U.S. Treasuries and bonds from some other "risk-free" nations are losing their rate advantage.
The study by YiLi Chien, an economist and senior policy advisor at the regional Fed bank, and Kevin Bloodworth, a research associate there, found that as the U.S. central bank began shrinking its balance sheet in 2022, the convenience yield fell around 40 basis points, meaning the U.S. had to pay investors that much more for its borrowing.
Warsh would have to figure out how to counteract that effect to shrink holdings further or explain it as the cost of large deficits, something that would put him close to the sort of "mission creep" into fiscal affairs he has criticized.
Jeffrey Lacker, who ran the Richmond Fed during Warsh's time as a Fed governor, said Warsh's balance sheet commentary "resonates strongly" with those wanting a more restrained type of central banking, but that it will take discipline beyond the Fed's own offices.
"I think for the Fed to back away from things that amount to debt management would clarify market participants' expectations and would help make the Treasury market more resilient," Lacker said.
It would also "aid in sort of the general process of the Treasury as it has to ... face the music in essence."
Reporting by Howard Schneider; Additional reporting by Ann Saphir; Editing by Dan Burns and Paul Simao
https://www.reuters.com/business/financ ... 026-05-15/
"US debt load could undercut Warsh's plan to shrink Fed balance sheet"
By Howard Schneider
May 15, 2026
Summary
* Warsh's plan could be complicated by rising US debt, waning appeal of bonds
* Smaller Fed balance sheet could mean higher interest rates
* Fed still lacks framework for 'quantitative easing,' tightening
WASHINGTON, May 15 (Reuters) - Incoming Federal Reserve chief Kevin Warsh's plans to shrink the U.S. central bank's "footprint" in financial markets could be constrained by rising federal debt and the potentially lost luster of U.S. Treasuries, analysts said, with rising long-term interest rates a sign of the challenge awaiting the new Fed chair.
Yields on U.S. Treasury bonds headed higher on Friday, with interest on the 2-year bond, a rough proxy for monetary policy, up more than half a percentage point, to more than 4%, since the start of the U.S. war with Iran raised new inflation concerns.
The interest rate on the 30-year bond topped 5.1%, a level not seen on a persistent basis since before the 2007 to 2009 financial crisis and recession ushered in an era of easy monetary policy and cheap borrowing costs that may be at an end.
Investors in contracts tied to the Fed's policy rate now see the Warsh Fed hiking rates as soon as January, with yields on inflation-linked securities also rising in a particularly troublesome sign for the Fed if it continues.
Warsh, who was confirmed by the U.S. Senate on Wednesday to replace Fed Chair Jerome Powell, has advocated for a smaller central bank role and less market intervention as part of a return to a more conventional monetary policy style that he feels can stay better focused on controlling inflation and avoid distorting markets.
However attractive in theory, the approach could also reveal gaps in the market for Treasuries that would either push up long-term interest rates to the detriment of businesses, households and the government itself, or put pressure on the Fed to step in and help hold borrowing costs down, said Hanno Lustig, a finance professor at Stanford University's Graduate School of Business.
Lustig's recent research has suggested top developed markets like the U.S. have lost their "convenience yield," effectively a lowered rate on government debt for countries with risk-free standing and independent central banks.
If Warsh and other Fed officials "want to get ahead of this, when yields are responding to fiscal shocks, they have to ... be transparent about that, rather than say 'Oh, this is a hiccup in the Treasury market,'" that requires the Fed to buy bonds to smooth market functioning, Lustig said on the sidelines of a recent conference at Stanford's Hoover Institution.
"In order to have real price discovery in the Treasury market, we need a central bank that will not intervene."
Warsh has been critical since his days as a Fed governor more than a decade ago of how the central bank has expanded its balance sheet during crises, or even in times of bank funding market stress, without clear guidelines on what securities it should buy, in what quantities, or a clear plan for reducing holdings afterward.
Instead, its holdings have grown and fallen through a combination of financial dark arts - probing to see just how much liquidity the banking system needs before interest rates start rising - and throw-everything-against-the-wall reactions to events like the COVID-19 pandemic or the 2007-2009 recession and financial crisis.
The Fed currently holds about $6.7 trillion in assets, down from a peak of around $9 trillion in 2022, and the amount is again growing slowly to keep bank reserves flush.
There's still no broad agreement about how Fed bond purchases, a process known as "quantitative easing," affect the economy.
The U.S. central bank usually confines its monetary policy decisions to raising and lowering a short-term interest rate that influences consumer and business borrowing costs.
Higher rates cut into spending when inflation is rising, and lower rates encourage spending during economic weakness.
Once its policy rate hits zero and can go no lower, however, as it has during economic shocks, the Fed can use its theoretically unlimited balance sheet - its power to create money - to intervene.
The assets it buys leave the system and are replaced with cash, which helps lower longer-term rates even further to encourage spending and boost growth.
OTHER COMPLICATIONS
Fed policymakers and others generally agree that it works, at least to some degree.
But "they're overdue for a discussion around how they use the balance sheet and under what circumstances," said Ellen Meade, a former top Fed adviser who is now an economics professor at Duke University.
"That's a nine-to-12-month process, with staff memos and briefings, committee discussions and then agreement."
If the aim is to both reduce holdings and hold down rates, however, it also might require closer-than-usual coordination with the U.S. Treasury, whose debt-issuance decisions could influence rates as the Fed cuts its holdings.
In a recent analysis, Bill Nelson, a former Fed staffer and now the chief economist at the Bank Policy Institute, said if the U.S. central bank used regulatory and other changes to reduce its balance sheet by another $2 trillion, the effect on its policy rate would depend heavily on how that was engineered and how the Treasury Department reacted - ranging anywhere from a 0.84-percentage-point rate cut to a possible hike.
Not everyone sees a big balance sheet as the problem Warsh believes it is.
Fed Governor Christopher Waller, noting that a main reason for large central bank asset holdings is to provide ample liquidity for banks, said proposals to curtail those holdings to the point where financial institutions compete for reserves would be "extremely inefficient and stupid."
In a recent Brookings Institution survey of top Fed and economic analysts, most of the 29 respondents said the size of the Fed's balance sheet "does not currently pose a problem for the growth or financial stability of the U.S. economy."
Beyond those issues, the broader debt dynamics could make it even tougher as Warsh takes over.
The Congressional Budget Office estimates a federal deficit equal to 5.8% of gross domestic product for fiscal year 2026 versus a 50-year average of 3.8%, with rising interest costs driving it higher.
Research from the St. Louis Fed also concluded that U.S. Treasuries and bonds from some other "risk-free" nations are losing their rate advantage.
The study by YiLi Chien, an economist and senior policy advisor at the regional Fed bank, and Kevin Bloodworth, a research associate there, found that as the U.S. central bank began shrinking its balance sheet in 2022, the convenience yield fell around 40 basis points, meaning the U.S. had to pay investors that much more for its borrowing.
Warsh would have to figure out how to counteract that effect to shrink holdings further or explain it as the cost of large deficits, something that would put him close to the sort of "mission creep" into fiscal affairs he has criticized.
Jeffrey Lacker, who ran the Richmond Fed during Warsh's time as a Fed governor, said Warsh's balance sheet commentary "resonates strongly" with those wanting a more restrained type of central banking, but that it will take discipline beyond the Fed's own offices.
"I think for the Fed to back away from things that amount to debt management would clarify market participants' expectations and would help make the Treasury market more resilient," Lacker said.
It would also "aid in sort of the general process of the Treasury as it has to ... face the music in essence."
Reporting by Howard Schneider; Additional reporting by Ann Saphir; Editing by Dan Burns and Paul Simao
https://www.reuters.com/business/financ ... 026-05-15/
Re: THE DAILY NEWS
RIGZONE
"Oil Settles Higher on Iran Doubts"
by Bloomberg | A. Longley, R.W. Neo, M. Gindis
Monday, May 18, 2026
Oil edged higher in choppy trading as fresh doubts emerged over the fate of peace negotiations between the US and Iran that could secure the reopening of the critical Strait of Hormuz.
West Texas Intermediate futures rose 3% to close above $108 a barrel and Brent futures closed around $112 a barrel as both sides deemed fresh proposals insufficient to ending the war.
Oil pared some gains post settlement when US President Donald Trump said he had called off planned attacks on Iran set for Tuesday at the request of other Middle Eastern countries.
Traders have been bracing for a possible resumption of the fighting that roiled the Middle East earlier in the conflict, prolonging the closure of Hormuz to vital energy flows and risking further damage on infrastructure.
Oil has risen almost 50% since the US and Israel first attacked Iran at the end of February, with deeply reduced flows of crude and liquefied natural gas making its way to buyers around the world.
Prices have been extremely volatile, however, with steep drops at times when peace hopes seem to be taking shape.
The market is in "a race against time" as the factors that restrained price rises from the war stand to come under strain if the vital waterway stays closed into June, Morgan Stanley said last week.
The International Energy Agency reiterated on Monday that global oil inventories are falling quickly.
Prices were down earlier in the session after Iran's semi-official Tasnim news agency said the US had offered to lift sanctions on the sale of Iranian oil until a final deal was reached.
A US official who refused to be named due to the sensitivity of the matter said the story was false, but didn't elaborate.
In a similar vein, the US is expected to issue a waiver allowing the sale of Russian crude oil and petroleum products that are already loaded on tankers, according to people familiar, just days after the previous one lapsed.
The license will "help stabilize the physical crude market," wrote Treasury Secretary Scott Bessent in a post on X.
Two of the major solutions in the oil market so far have come from the world's two largest economies.
The US has been exporting record volumes overseas, while Chinese imports have plunged dramatically.
Processors in the latter churned through the least amount of oil since 2022, according to data released on Monday.
While a tenuous ceasefire agreed to in April has mostly held, energy facilities were targeted in the Persian Gulf over the weekend.
An attack by drones sparked a fire at a United Arab Emirates nuclear facility, underscoring the fragility of the ceasefire.
Still, paper markets remain relatively subdued despite signs of physical tightness.
Money managers cut net-long positions in both Brent and WTI last week to the lowest levels since March 3.
"Many traders are still staying sidelined, and managed money length was reduced significantly last week, limiting some of the positioning pressure," said Rebecca Babin, senior energy trader at CIBC Private Wealth Group.
"Headlines remain the primary driver, but there is a growing focus on fundamentals as the market appears less stressed than many would have expected given the scale of supply disruption."
Oil Prices
WTI for July rose 3.1% to settle at $108.66 a barrel.
The June contract expires on Tuesday
Brent for July closed 2.6% higher at $112.10 a barrel.
https://www.rigzone.com/news/wire/oil_s ... 8-article/
"Oil Settles Higher on Iran Doubts"
by Bloomberg | A. Longley, R.W. Neo, M. Gindis
Monday, May 18, 2026
Oil edged higher in choppy trading as fresh doubts emerged over the fate of peace negotiations between the US and Iran that could secure the reopening of the critical Strait of Hormuz.
West Texas Intermediate futures rose 3% to close above $108 a barrel and Brent futures closed around $112 a barrel as both sides deemed fresh proposals insufficient to ending the war.
Oil pared some gains post settlement when US President Donald Trump said he had called off planned attacks on Iran set for Tuesday at the request of other Middle Eastern countries.
Traders have been bracing for a possible resumption of the fighting that roiled the Middle East earlier in the conflict, prolonging the closure of Hormuz to vital energy flows and risking further damage on infrastructure.
Oil has risen almost 50% since the US and Israel first attacked Iran at the end of February, with deeply reduced flows of crude and liquefied natural gas making its way to buyers around the world.
Prices have been extremely volatile, however, with steep drops at times when peace hopes seem to be taking shape.
The market is in "a race against time" as the factors that restrained price rises from the war stand to come under strain if the vital waterway stays closed into June, Morgan Stanley said last week.
The International Energy Agency reiterated on Monday that global oil inventories are falling quickly.
Prices were down earlier in the session after Iran's semi-official Tasnim news agency said the US had offered to lift sanctions on the sale of Iranian oil until a final deal was reached.
A US official who refused to be named due to the sensitivity of the matter said the story was false, but didn't elaborate.
In a similar vein, the US is expected to issue a waiver allowing the sale of Russian crude oil and petroleum products that are already loaded on tankers, according to people familiar, just days after the previous one lapsed.
The license will "help stabilize the physical crude market," wrote Treasury Secretary Scott Bessent in a post on X.
Two of the major solutions in the oil market so far have come from the world's two largest economies.
The US has been exporting record volumes overseas, while Chinese imports have plunged dramatically.
Processors in the latter churned through the least amount of oil since 2022, according to data released on Monday.
While a tenuous ceasefire agreed to in April has mostly held, energy facilities were targeted in the Persian Gulf over the weekend.
An attack by drones sparked a fire at a United Arab Emirates nuclear facility, underscoring the fragility of the ceasefire.
Still, paper markets remain relatively subdued despite signs of physical tightness.
Money managers cut net-long positions in both Brent and WTI last week to the lowest levels since March 3.
"Many traders are still staying sidelined, and managed money length was reduced significantly last week, limiting some of the positioning pressure," said Rebecca Babin, senior energy trader at CIBC Private Wealth Group.
"Headlines remain the primary driver, but there is a growing focus on fundamentals as the market appears less stressed than many would have expected given the scale of supply disruption."
Oil Prices
WTI for July rose 3.1% to settle at $108.66 a barrel.
The June contract expires on Tuesday
Brent for July closed 2.6% higher at $112.10 a barrel.
https://www.rigzone.com/news/wire/oil_s ... 8-article/
Re: THE DAILY NEWS
CNBC
"Trump says he’s postponing ‘scheduled attack of Iran tomorrow’ at Middle East leaders’ request"
Kevin Breuninger @KevinWilliamB
Published Mon, May 18 2026
Key Points
* President Donald Trump said he is calling off a plan to attack Iran on Tuesday after the heads of three regional powers in the Middle East asked him to “hold off.”
* Trump said he received requests from Qatari Emir Tamim bin Hamad Al Thani, Saudi Crown Prince Mohammed bin Salman and United Arab Emirates President Mohammed bin Zayed Al Nahyan.
* Defense Secretary Pete Hegseth and Joint Chiefs Chairman Gen. Dan Cain should still “be prepared to go forward with a full, large scale assault of Iran, on a moment’s notice, in the event that an acceptable Deal is not reached,” Trump said.
President Donald Trump said Monday he is calling off a plan to attack Iran on Tuesday after the heads of three regional powers in the Middle East asked him to “hold off.”
Trump, in a Truth Social post, said he has informed U.S. military leaders “that we will NOT be doing the scheduled attack of Iran tomorrow” in light of the requests from Qatari Emir Tamim bin Hamad Al Thani, Saudi Crown Prince Mohammed bin Salman and United Arab Emirates President Mohammed bin Zayed Al Nahyan.
There had been no clear indication prior to Trump’s post that the U.S. was preparing to strike Iran on Tuesday, officially scrapping its tattered ceasefire with Iran.
Trump had told the New York Post in an interview earlier Monday that Iran knows “what’s going to be happening soon,” though he declined to provide details.
Trump was considering resuming active military operations after Tehran’s latest response in ongoing negotiations over a deal to end the war was deemed insufficient, Axios reported.
The president claimed in Monday’s post that the three regional leaders had asked for the planned attack to be postponed “in that serious negotiations are now taking place, and that, in their opinion, as Great Leaders and Allies, a Deal will be made, which will be very acceptable to the United States of America, as well as all Countries in the Middle East, and beyond.”
“This Deal will include, importantly, NO NUCLEAR WEAPONS FOR IRAN!” Trump wrote.
The president said he told Defense Secretary Pete Hegseth and Joint Chiefs Chairman Gen. Dan Caine that while Tuesday’s attack is off, they should “be prepared to go forward with a full, large scale assault of Iran, on a moment’s notice, in the event that an acceptable Deal is not reached.”
Hegseth traveled to Kentucky on Monday to attend a political event with a Republican House candidate challenging incumbent GOP Rep. Thomas Massie, whom Trump wants to kick out of Congress.
The U.S. and Iran are locked in a sort of military and economic stalemate centered on the Strait of Hormuz, the vital global oil-shipping route that has been beset by dueling blockades amid the war, preventing most ships from passing through.
The battle to control the strait has deeply frayed an already shaky ceasefire, which began nearly six weeks earlier is nominally still in effect — though it has repeatedly been punctured by fighting, and Trump last week said it’s on “life support.”
https://www.cnbc.com/2026/05/18/trump-i ... -deal.html
"Trump says he’s postponing ‘scheduled attack of Iran tomorrow’ at Middle East leaders’ request"
Kevin Breuninger @KevinWilliamB
Published Mon, May 18 2026
Key Points
* President Donald Trump said he is calling off a plan to attack Iran on Tuesday after the heads of three regional powers in the Middle East asked him to “hold off.”
* Trump said he received requests from Qatari Emir Tamim bin Hamad Al Thani, Saudi Crown Prince Mohammed bin Salman and United Arab Emirates President Mohammed bin Zayed Al Nahyan.
* Defense Secretary Pete Hegseth and Joint Chiefs Chairman Gen. Dan Cain should still “be prepared to go forward with a full, large scale assault of Iran, on a moment’s notice, in the event that an acceptable Deal is not reached,” Trump said.
President Donald Trump said Monday he is calling off a plan to attack Iran on Tuesday after the heads of three regional powers in the Middle East asked him to “hold off.”
Trump, in a Truth Social post, said he has informed U.S. military leaders “that we will NOT be doing the scheduled attack of Iran tomorrow” in light of the requests from Qatari Emir Tamim bin Hamad Al Thani, Saudi Crown Prince Mohammed bin Salman and United Arab Emirates President Mohammed bin Zayed Al Nahyan.
There had been no clear indication prior to Trump’s post that the U.S. was preparing to strike Iran on Tuesday, officially scrapping its tattered ceasefire with Iran.
Trump had told the New York Post in an interview earlier Monday that Iran knows “what’s going to be happening soon,” though he declined to provide details.
Trump was considering resuming active military operations after Tehran’s latest response in ongoing negotiations over a deal to end the war was deemed insufficient, Axios reported.
The president claimed in Monday’s post that the three regional leaders had asked for the planned attack to be postponed “in that serious negotiations are now taking place, and that, in their opinion, as Great Leaders and Allies, a Deal will be made, which will be very acceptable to the United States of America, as well as all Countries in the Middle East, and beyond.”
“This Deal will include, importantly, NO NUCLEAR WEAPONS FOR IRAN!” Trump wrote.
The president said he told Defense Secretary Pete Hegseth and Joint Chiefs Chairman Gen. Dan Caine that while Tuesday’s attack is off, they should “be prepared to go forward with a full, large scale assault of Iran, on a moment’s notice, in the event that an acceptable Deal is not reached.”
Hegseth traveled to Kentucky on Monday to attend a political event with a Republican House candidate challenging incumbent GOP Rep. Thomas Massie, whom Trump wants to kick out of Congress.
The U.S. and Iran are locked in a sort of military and economic stalemate centered on the Strait of Hormuz, the vital global oil-shipping route that has been beset by dueling blockades amid the war, preventing most ships from passing through.
The battle to control the strait has deeply frayed an already shaky ceasefire, which began nearly six weeks earlier is nominally still in effect — though it has repeatedly been punctured by fighting, and Trump last week said it’s on “life support.”
https://www.cnbc.com/2026/05/18/trump-i ... -deal.html
Re: THE DAILY NEWS
CNBC
"10-year Treasury yield touches highest in a year, Japan’s 30-year yield rises to a record"
Sean Conlon @SeanAustin96 Hugh Leask
Published Mon, May 18 2026
U.S. Treasury yields were little changed on Monday, taking a breather after global bond rout that sent them sharply higher last week.
The 10-year U.S. Treasury note yield — the key benchmark for U.S. government borrowing — was less than 1 basis point higher at 4.601%.
Earlier in the day, it hit its highest level in 15 months.
The longer-dated 30-year Treasury bond yield, which is more sensitive to political risks, also rose less than 1 basis point to 5.133%.
It hit its highest level in almost a year last week.
The 2-year Treasury note yield, which tends to react in line with short-term Federal Reserve interest rate decisions, slipped more than a basis point to 4.065%.
One basis point is equal to 0.01%, and yields and prices move in opposite directions.
Treasury yields soared last week as the outlook on negotiations between the U.S. and Iran dampened, raising inflation fears as oil prices remain elevated.
On top of that, new U.S. data showed upward price pressures are beginning to filter down to the consumer.
Treasury Secretary Scott Bessent joined G7 colleagues and central bankers in Paris on Monday, as fresh concerns over inflation and public debt weigh on global bond markets.
Asked whether she is worried about bond market volatility, President of the European Central Bank Christine Lagarde said: “I always worry, that’s my job.”
The latest spike in yields isn’t exclusive to the U.S., either.
On Monday, the 10-year German bund yield hit its highest level since May 6, 2011, while Japan’s 10-year JGB surged to its highest level since May 28, 1997.
The Japanese 30-year yield reached its highest level in history dating back to 1999.
In the U.K., the 10-year Gilt yield, the benchmark for British government debt, reached its highest level since July 2, 2008.
The 30-year Gilt yield hit its highest level since March 6, 1998.
Yields remain elevated amid uncertainty over the fate of Britain’s Prime Minister Keir Starmer.
With the economic fallout from the Middle East conflict front and center of the G7 summit, central bankers now face a tightrope on interest rates, said Will Hobbs, chief investment officer at Brooks Macdonald.
“Inflation is going to be a tricky, annoying problem for central banks and bond investors,” Hobbs told told CNBC’s ‘Europe Early Edition’ Monday.
Oil prices were higher Monday.
Brent crude, the international benchmark, closed 2.6% higher at $112.10 per barrel, while U.S. West Texas Intermediate futures closed up 3.07% at $108.66 per barrel.
https://www.cnbc.com/2026/05/18/treasur ... t-oil.html
"10-year Treasury yield touches highest in a year, Japan’s 30-year yield rises to a record"
Sean Conlon @SeanAustin96 Hugh Leask
Published Mon, May 18 2026
U.S. Treasury yields were little changed on Monday, taking a breather after global bond rout that sent them sharply higher last week.
The 10-year U.S. Treasury note yield — the key benchmark for U.S. government borrowing — was less than 1 basis point higher at 4.601%.
Earlier in the day, it hit its highest level in 15 months.
The longer-dated 30-year Treasury bond yield, which is more sensitive to political risks, also rose less than 1 basis point to 5.133%.
It hit its highest level in almost a year last week.
The 2-year Treasury note yield, which tends to react in line with short-term Federal Reserve interest rate decisions, slipped more than a basis point to 4.065%.
One basis point is equal to 0.01%, and yields and prices move in opposite directions.
Treasury yields soared last week as the outlook on negotiations between the U.S. and Iran dampened, raising inflation fears as oil prices remain elevated.
On top of that, new U.S. data showed upward price pressures are beginning to filter down to the consumer.
Treasury Secretary Scott Bessent joined G7 colleagues and central bankers in Paris on Monday, as fresh concerns over inflation and public debt weigh on global bond markets.
Asked whether she is worried about bond market volatility, President of the European Central Bank Christine Lagarde said: “I always worry, that’s my job.”
The latest spike in yields isn’t exclusive to the U.S., either.
On Monday, the 10-year German bund yield hit its highest level since May 6, 2011, while Japan’s 10-year JGB surged to its highest level since May 28, 1997.
The Japanese 30-year yield reached its highest level in history dating back to 1999.
In the U.K., the 10-year Gilt yield, the benchmark for British government debt, reached its highest level since July 2, 2008.
The 30-year Gilt yield hit its highest level since March 6, 1998.
Yields remain elevated amid uncertainty over the fate of Britain’s Prime Minister Keir Starmer.
With the economic fallout from the Middle East conflict front and center of the G7 summit, central bankers now face a tightrope on interest rates, said Will Hobbs, chief investment officer at Brooks Macdonald.
“Inflation is going to be a tricky, annoying problem for central banks and bond investors,” Hobbs told told CNBC’s ‘Europe Early Edition’ Monday.
Oil prices were higher Monday.
Brent crude, the international benchmark, closed 2.6% higher at $112.10 per barrel, while U.S. West Texas Intermediate futures closed up 3.07% at $108.66 per barrel.
https://www.cnbc.com/2026/05/18/treasur ... t-oil.html