01/10/2025

BIZ & FINANCE WEDNESDAY | OCT 1, 2025

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Trump slaps 10% tariff on lumber imports, 25% on kitchen cabinets and furniture

BRITISH ECONOMY GREW 0.3% IN Q2, CURRENT ACCOUNT GAP WIDENS LONDON: Britain’s economy grew 0.3% in the April-to-June period of this year, the Office for National Statistics said yesterday, unrevised from its initial estimate and as expected in a Reuters poll of economists. Yesterday’s data showed that Britain’s GDP in the second quarter was 1.4% higher than a year ago – revised up from an initial 1.2% estimate – while on a per capita basis, output in the second quarter was 0.9% higher than the year before. Overall 2024 GDP growth was unrevised at 1.1%. Britain’s current account deficit in the three months to the end of June totalled £28.939 billion (RM163.88 billion), well above a poll forecast of £24.9 billion and equivalent to 3.8% of GDP, up from 2.8% in the first quarter of 2025. – Reuters CHINA’S ZIJIN GOLD SOARS MORE THAN 60% IN HONG KONG MARKET DEBUT HONG KONG: Shares in China’s Zijin Gold International surged more than 60% on its debut in Hong Kong yesterday after raising more than US$3 billion (RM12.6 billion) in one of the world’s biggest initial public offerings this year. The blockbuster opening comes as gold prices continue to hit record highs amid surging demand for the safe-haven asset to head off broader market volatility and expected US interest rate cuts. Zijin Gold – a unit of Zijin Mining, China’s biggest miner – rocketed 67% to a peak of HK$120 (RM65 billion), valuing it at around HK$300 billion (US$38.6 billion). The company is one of the world’s fastest-growing gold producers, with interests in eight mines located in regions across Central Asia, South America, Oceania and Africa. – AFP Australia’s central bank holds rates, cautious on inflation SYDNEY:- Australia’s central bank yesterday left its cash rate steady as expected at 3.60%, saying recent data suggested inflation might be higher than forecast in the third quarter and that the economic outlook remained uncertain. Wrapping up a two-day policy meeting, the Reserve Bank of Australia (RBA) said the board judged it was appropriate to remain cautious on policy, but was well-placed to respond to international developments. The more cautious commentary from the central bank prompted markets to further trim bets on rate cuts this year and for some analysts to even call a possible end to the current policy easing cycle if conditions remain upbeat. Markets had seen scant chance of a further easing this week after a strong second quarter gross domestic product (GDP) report and a high monthly inflation reading that argued for a measured pace of policy easing. Speaking to reporters after the decision, RBA governor Michele Bullock said the central bank would remain data dependent and by November have quarterly inflation data, a labour market report and updated economic forecasts, as well as more forward looking indicators to decide on policy. “What we are focusing on is an interest rate path that will deliver us inflation sustainably in the band. That could mean a couple more reductions. It might not. I don’t know at this point and we will look at all this again in November.” The central bank said recent data, while partial and volatile, suggests that inflation in the third quarter may be higher than expected due to sticky prices in market services, adding that it was appropriate to remain cautious. – Reuters

BR I E F S

WASHINGTON: US President Donald Trump said on Monday he was slapping 10% tariff on imported timber and lumber and 25% duties on kitchen cabinets, bathroom vanities and upholstered furniture, continuing his tariff assault on global trading partners. The action is the first in three sectors that Trump said last week would get steep new duties as early as today, including patented pharmaceutical imports, and heavy truck imports. Monday’s proclamation sets the start of the lumber and furniture duties two weeks later, on Oct 14. Trump signed a presidential proclamation laying out his argument that timber, lumber and furniture imports are eroding US national

wood mills and disruptions of wood product supply chains and diminishing utilisation of the US domestic wood industry. “Because of the state of the United States wood industry, the United States may be unable to meet demands for wood products that are crucial to the national defense and critical infrastructure,” the statement said. The order added that wood products were used for “building infrastructure for operational testing, housing and storage for personnel and materiel, transporting munitions, as an ingredient in munitions, and as a component in missile-defense systems and thermal-protection systems for nuclear-reentry vehicles”. – Reuters

security to justify the new duties under Section 232 of the Trade Act of 1974. Trump’s increasing use of Section 232 comes as he awaits a Supreme Court ruling on the legality of his broader “reciprocal” tariffs on global trading partners, which two lower courts have struck down. The proclamation said the tariff rates would start on Oct 14, but added that duties would increase on Jan 1 to 30% for upholstered wooden products and 50% for kitchen cabinets and vanities imported from countries that failed to reach an agreement with the United States. Trump’s proclamation said wood product imports were weakening the US economy, resulting in the persistent threat of closures of

China factory activity shrinks for sixth straight month Boxes of clothing for export are pictured at a factory in Guangzhou, Guangdong province, China. Export activities have been surprisingly resilient so far this year and helped to partly offset the weak domestic demand, an economist says. – REUTERSPIC

resilient so far this year and helped to partly offset the weak domestic demand.” On Monday, the state’s planner said China will deploy policy-based financial tools to the value of 500 billion yuan (RM295.8 billion) to accelerate investment projects, as part of efforts to support the slowing economy. Authorities are using the new financing tools to boost financial services and effective investment, Li Chao, a spokesperson for the National Development and Reform Commission, said. “We are working with relevant parties to promptly allocate funds from these new policy based financial instruments to specific projects,” Li told a media briefing. “The total scale of these new policy-based financial instruments is 500 billion yuan, all of which will be used to supplement project capital.” “The launch of the programme suggests Beijing is becoming more concerned about the growth outlook, especially the slump in investment in July and August, reinforcing our more cautious views for H2,” said Ting Lu, chief China economist at Nomura, in a research note yesterday. The funding will be used as seed capital for projects in areas including the digital economy, artificial intelligence, the low-altitude economy, consumption infrastructure, transportation and logistics, according to local media reports. – AFP, Reuters

The prolonged slump underlines the twin pressures on China’s economy: domestic demand has failed to mount a durable recovery in the years since the pandemic while US President Donald Trump’s tariffs have squeezed Chinese factories as well as overseas firms that buy components. All the same, a separate private-sector survey of factory managers showed the fastest expansion since March, buoyed by rising new orders and accelerated production growth, including an uptick in new export orders. The two surveys cover different pools of producers, with the National Bureau of Statistics (NBS) placing more emphasis on large- and medium-sized firms focused on domestic sales, while the RatingDog General PMI, compiled by S&P Global, which came in at 51.2, up from 50.5 in August, includes a larger share of export-orientated private companies. Official data also showed yesterday that the non-manufacturing PMI, which measures activity in sectors including services and construction, fell to 50.0 in September from 50.3 in August. That was short of a Bloomberg forecast of 50.2 and was the lowest since November. “Economic momentum is weak in the third quarter,” Zhiwei Zhang, president and chief economist at Pinpoint Asset Management, said in a note. “Export activities have been surprisingly

BEIJING: China’s factory activity shrank for a sixth straight month in September, official data showed yesterday, as a domestic consumer slump and lingering trade uncertainty weigh on the economy. The manufacturing purchasing managers’ index (PMI) came in at 49.8, narrowly below the value of 50 separating contraction from expansion, according to the National Bureau of Statistics (NBS). Still, the reading beat the forecast of 49.6 in a Bloomberg survey of economists and was the highest since March. But it extended a streak of contraction that began in April, as factories across the manufacturing powerhouse contend with turbulence from the ongoing US-China trade war. “Overall economic output expansion in the country accelerated slightly” during the month, said NBS statistician Huo Lihui in a statement. The figures come just before the start of the country’s “Golden Week” National Day holiday, a period that usually sees slower factory activity. o September manufacturing PMI remains below growth threshold at 49.8