Daily Brief | July 09 2025

Top News

·     In Mexico, headline inflation edged down slightly in June; however, core inflation rose for the fourth consecutive month.

·     President Donald Trump announced potential tariffs of 50% on copper imports and up to 200% on pharmaceutical products, though the latter may take a year to come into effect to allow companies time to adjust.

·     Treasury Secretary Scott Bessent estimated that tariff revenues will reach $300 billion this year, following measures targeting metals, automobiles, and semiconductors.

·     China’s consumer price inflation stood at 0.1% in June, above market expectations of -0.1% and the previous month’s reading of -0.2%. Meanwhile, producer price inflation remained in deflation territory at -3.6% in June (vs. -3.3% in May).

Economic Outlook

In Mexico, headline inflation declined slightly in June, although core inflation rose for the fourth consecutive month. INEGI reported that the National Consumer Price Index for June posted a monthly variation of 0.28%, slightly above the market consensus expectation of 0.27% and in line with our estimate. On an annual basis, headline inflation eased from 4.42% in May to 4.32% in June. The items with the highest upward impact on inflation in June were owner-occupied housing, casual dining establishments (such as diners, food stalls, and taquerías), and beef. Core inflation—which excludes the most volatile components like energy, agricultural products, and regulated prices—increased by 0.41% in June, surpassing both the consensus and our forecast of 0.36%. Annually, core inflation accelerated for the fourth straight month, from 3.64% in March to 4.24% in June. By component, goods rose by 3.91% y/y (previously 3.67%) and services by 4.62% y/y (previously 4.49%). In our view, the trend in core inflation is particularly noteworthy, as our forecasts suggest it may remain above 4.0% for the remainder of the year—a level clearly above the 3% inflation target.

Markets and Stocks

U.S. stock index futures are ticking slightly higher this Wednesday, as investors closely monitor the latest tariff measures announced by President Donald Trump. While sentiment has turned somewhat more positive following Tuesday’s volatile session, caution remains after Trump confirmed there will be no changes or extensions to the new tariffs set to take effect on August 1 for 14 countries, with rates ranging from 25% to 40%. Additionally, he announced a 50% tariff on copper imports and signaled possible duties of up to 200% on pharmaceutical products, though these could take up to 18 months to be implemented. Global markets showed a muted reaction. Separately, investors are awaiting the release of the Federal Reserve’s latest meeting minutes today to assess the direction of monetary policy.

In the bond market, U.S. Treasury yields are edging lower amid growing trade-related uncertainty.

In commodities, oil is extending its rally since late June, supported by renewed attacks on vessels in the Red Sea, concerns about the impact of copper tariffs on economic activity, and a downward revision to U.S. oil output forecasts. In contrast, gold continues to slide, touching its lowest level in over a week, while copper prices are retreating on the Chicago Mercantile Exchange after spiking yesterday in reaction to Trump’s tariff announcement.

In June 2025, Volaris reported total capacity (ASMs) of 2,804 million, representing a marginal year-over-year increase of 0.6%. Total passenger traffic was virtually unchanged compared to June 2024, with a slight 0.2% gain in the domestic segment and stability in international traffic, while total load factor declined by 1.7 percentage points.

Corporate News

– Starbucks shares rose following media reports that its China subsidiary has received offers for a potential partial sale, valuing the unit at up to $10 billion.

– UnitedHealth shares declined after The Wall Street Journal reported that the U.S. Department of Justice is investigating the company over alleged irregularities in its billing practices.

– Verona Pharma shares surged 20% after Merck announced the acquisition of the British firm in a deal worth nearly $10 billion, aimed at strengthening its respiratory treatment portfolio. Merck shares posted a slight gain.