Afp Business Asia

Japanese Prime Minister Sanae Takaichi was projected to have won a thumping victory in snap elections on Sunday, a result that could however rile China and worry financial markets.Capitalising on her honeymoon start as Japan’s first woman premier, Takaichi’s ruling bloc looked on course to have secured a two-thirds majority in the lower house, according to media estimates.If confirmed, it would be the best result for the Liberal Democratic Party (LDP) since elections in 2017 under Takaichi’s mentor, assassinated former prime minister Shinzo Abe.The LDP alone was seen winning about 300 of the 465 seats up for grabs, up from 198, and regaining a majority lost in 2024 — and potentially a super-majority on its own.”We received backing for Prime Minister Sanae Takaichi’s responsible, proactive fiscal policies and a strengthening of national defence capabilities,” LDP secretary general Shunichi Suzuki told Japanese media.The new Centrist Reform Alliance of the main opposition Constitutional Democratic Party (CDP) and the LDP’s previous partner Komeito looked to have lost more than two-thirds of its 167 seats.The anti-immigration Sanseito party was projected to have increased its seats from two to between five and 14, broadcaster NHK said.Takaichi has injected new life into the LDP, which has governed Japan almost non-stop for decades but which has shed support in recent elections because of unhappiness about rising prices and corruption.- A hit with voters -Takaichi, 64, was a heavy metal drummer in her youth, an admirer of Britain’s “Iron Lady” Margaret Thatcher, and on the ultra-conservative fringe of the LDP when she became party chief and prime minister in October.She has defied pessimists to be a hit with voters, especially young ones, with fans lapping up everything from her handbag to her jamming to a K-pop song with South Korea’s president.But she will have to deliver on the economy.”With prices rising like this, what matters most to me is what policies they’ll adopt to deal with inflation,” Chika Sakamoto, 50, told AFP at a voting station in a snowy Tokyo on Sunday.”Prices for just about everything are really going up, but incomes aren’t rising much, so our disposable income is shrinking,” she said.- Pandas and public debt -However, Takaichi has not had everything her own way, particularly with regard to worries about her stewardship of the public finances of Asia’s number-two economy.She followed up a $135 billion stimulus package aimed at easing the pain of inflation — a big cause of voter discontent — with a campaign promise to suspend a consumption tax on food.Japan’s debt is more than twice the size of the entire economy, and in recent weeks yields on long-dated bonds have hit record highs, causing jitters worldwide.”Various parties are proposing policies like abolishing the consumption tax. While that might be fine for now, I’m very worried about whether such measures are truly responsible for the generations that come after us,” voter Taku Sakamoto, 49, told AFP.”My biggest concern is not just the present, but what will become of Japan going forward,” he said.Takaichi’s election triumph may also cause consternation in Beijing.Barely two weeks in office, Takaichi — seen before assuming the premiership as a China hawk — suggested that Japan could intervene militarily if Beijing sought to take self-ruled Taiwan by force.China regards the democratic island as part of its territory and has not ruled out force to annex it.With Takaichi having days earlier pulled out all the stops to welcome US President Donald Trump, Beijing was furious with her unscripted remarks.It summoned Tokyo’s ambassador, warned its citizens against visiting Japan and conducted joint air drills with Russia. Japan’s last two pandas were even returned to China last month.Trump has not publicly weighed in on the spat but endorsed Takaichi last week as a “strong, powerful, and wise Leader, and one that truly loves her Country”.Margarita Estevez-Abe, associate professor of political science at Syracuse University, said the China episode raised Takaichi’s popularity even more.”Now she doesn’t have to worry about any elections until 2028, when the next upper house elections will take place,” Estevez-Abe told AFP before the election.”So the best scenario for Japan is that Takaichi kind of takes a deep breath and focuses on amending the relationship with China.”

Thais voted Sunday in an election where progressive reformists were the clear opinion poll leaders but the incumbent conservative was expected to remain prime minister, extending the country’s political impasse.The Southeast Asian nation’s next government will need to contend with anaemic economic growth — the tourism sector vital but arrivals yet to return to their pre-Covid highs.Multibillion-dollar transnational cyberscam networks operate from several neighbouring countries, and a longstanding border dispute with Cambodia erupted into deadly fighting twice last year.”We need a strong leader who can protect our sovereignty,” said Yuernyong Loonboot, 64, the first voter to cast his ballot at a polling station in Buriram, the hometown of incumbent prime minister Anutin Charnvirakul.”Living here, the border conflict has made me anxious. War was never something we used to think about.”No party is forecast to win an outright majority, and coalition negotiations are expected to follow the results, expected later Sunday after polls closed at 5:00 pm (1000 GMT).The progressive People’s Party was the runaway leader in opinion polls ahead of the vote.But while its previous incarnation, Move Forward, won the most seats at the last poll three years ago, its candidate was blocked from the premiership and the party was later dissolved.Party leader Natthaphong Ruengpanyawut said after casting his ballot in Bangkok that he expected to “get the mandate from the people”.”We promise to the people that we’ll form the people’s government to bring policies that benefit all, not the few in the country,” he added.But ahead of voting day, political scientist Thitinan Pongsudhirak cautioned: “There are forces beyond the political arena in Thailand that call the final shots.”It’s not about the election, it’s about the dissolutions.”The Pheu Thai party of now jailed former prime minister Thaksin Shinawatra came second in 2023 and formed a coalition with the third-placed conservatives Bhumjaithai, only to have its prime minister removed by court order.He was succeeded by Thaksin’s daughter Paetongtarn, who was judicially ousted in turn before parliament anointed Bhumjaithai leader Anutin in September — the country’s third prime minister in two years.Thailand’s political history is replete with military coups, bloody street protests and judicial bans on prime ministers and parties.A constitution drafted under military rule following the last coup in 2014 gives significant power to institutions appointed by the senate, which is not directly elected.”People who are elected have been able to be undermined by people who are not elected,” said political scientist Napon Jatusripitak.”That’s not necessarily a good thing for a country where democratic experience has been turbulent.”- Populist handouts -Move Forward was dissolved after the constitutional court ruled its pledge to reform the strict royal insult law amounted to an attempt to overthrow the constitutional monarchy.The issue did not feature in the People’s Party campaign this time.Anutin told reporters he hoped voters would “trust us”. His Bhumjaithai party is second in the polls and analysts anticipate the conservative leader, who championed the legalisation of cannabis, could retain the premiership by again allying with Pheu Thai, now ranked third.Thailand’s most successful political party of modern times, Pheu Thai has fallen from grace after Paetongtarn was dismissed by the constitutional court over her handling of the Cambodia dispute, and with Thaksin jailed for corruption.His nephew Yodchanan Wongsawat, seeking to become the family’s fifth prime minister, said Sunday that “Thailand must change”, but pollster NIDA puts the party on just 16 percent, a far cry from its heyday.While Bhumjaithai touts its national defence credentials, especially after last year’s clashes with Cambodia, the People’s Party is advocating ending conscription and cutting the number of generals.All three major parties offer various populist handouts and socioeconomic policies, including Pheu Thai’s pledge to award nine daily prizes of one million baht ($31,000) each to boost the economy.A referendum ballot on Sunday also gives voters a chance to voice whether they want constitutional reform in principle, but with no specific measures on the table.

Even with its legendary image of glitz and glamour, diamond icon De Beers has struggled to attract a buyer after nearly two years on a market dulled by falling prices and the allure of lab-grown gems.The seller, mining titan Anglo American, even warned Thursday it may take a third writedown in as many years on the company that was born in South Africa 130 years ago and went on to dominate the global diamond market.This is after a $2.9  billion drop last year and $1.6 billion charge the year before, bringing its estimated value to about $5 billion, according to company records. Anglo’s bid to offload its loss-making company is not only being thwarted by the depressed market for mined diamonds, particularly in China, according to analysts. It is also complicated by a crowded field of suitors circling the sale, including at least three sub-Saharan governments and various private bidders, which makes any deal as political as it is financial, they added.Botswana has perhaps been the most ardent in its ambition to acquire a controlling stake in the company that oversees the world trade in the stones on which its economy depends.Botswana and its president, Duma Boko, De Beers’ biggest producer partner with a 15-percent holding, led a determined push to finalise a deal by last year but to no avail.Other diamond‑rich governments such as Angola and Namibia have also signalled interest, as have various sovereign wealth funds and a consortium led by former De Beers chief executive Gareth Penny.- ‘For better or worse’ -It is a complicated sale that — if it goes through — would mark one of the most significant shifts in the diamond industry in a quarter of a century, said independent analyst Paul Zimnisky. “The new owner will be in a position to fundamentally pave the future of the entire industry, for better or worse,” the diamond industry analyst told AFP. Botswana’s bid underscores its belief that it must manage the resource, which contributes about a third of its GDP, in order to capture more of the value chain and secure its economic future.But the International Monetary Fund has cautioned the mostly desert nation that concentrating more of its state resources in the diamond sector could heighten fiscal risks and leave it more exposed to swings in global demand.Zimnisky was also wary of what could amount to the “nationalisation” of De Beers.”In general, I think that a more private or capitalistic business model works better than a more government-run or social one,” he told AFP.”It is pertinent to have some private money involved as well as executives with relevant experience,” said the US-based analyst.- Patience -Anglo American has kept details of the sale negotiations under wraps, with chief executive Duncan Wanblad saying on Thursday only that the separation is “progressing”.The mining giant announced in 2024 — after fending off a hostile takeover bid from Australian rival BHP — that it would sell off De Beers and its coal and nickel operations in order to focus on iron ore and copper.”De Beers isn’t a single, clean asset, it spans mining, marketing, and retail, and it includes a government partner,” leading diamond industry analyst Edahn Golan told AFP. “From a buyer’s perspective, this is actually an attractive moment to step in. From a seller’s perspective, there’s a compelling argument for waiting until the market improves and capturing more of the upside,” he said.Demand for natural diamonds has weakened as younger buyers spend less on traditional jewellery and are drawn to cheaper lab‑grown gems.US tariffs and shifting trade routes are meanwhile disrupting flows through key cutting and polishing hubs.As the sector weathers a period of unprecedented uncertainty, retailers and manufacturers are sitting on their biggest polished‑stone stockpiles in years. Despite the gloomy market, Anglo would not be “interested in fire-selling” De Beers, Zimnisky said. “They can be patient,” he added.Golan agreed. “My hope is that the outcome is a company that both brings prosperity to the communities in which it operates and succeeds in rebuilding consumer interest in diamonds,” he said. 

India and Malaysia pledged Sunday to deepen their semiconductor partnership as the Indian Ocean neighbours ramp up trade and security links during a visit by Prime Minister Narendra Modi.Modi touched down in Malaysia on Saturday, his first visit in more than a decade, where he inked a number of agreements with Malaysian counterpart Anwar Ibrahim, including deals on renewable energy, health care and artificial intelligence.”Along with AI and digital technologies, we will advance our partnership in semiconductors, health, and food security,” Modi said.”This meeting and these exchanges are very vital, very strategic and critical to advance and enhance relations between India and Malaysia,” Anwar added at a news conference in Malaysia’s administrative capital Putrajaya.Malaysia ranks sixth in worldwide exports of semiconductors, while the sector contributes around 25 percent of gross domestic product, according to Malaysian government figures.India’s foreign ministry said the Southeast Asian nation had a “very strong semiconductor ecosystem”.”They have almost 30 to 40 years of experience in those areas,” the ministry added in a statement ahead of Modi’s arrival.”Our companies are… interested in collaborating with Malaysia,” it said, including in research and development and building manufacturing and testing plants.For instance, Tata Electronics was in talks last June with global semiconductor companies to buy a fabrication or outsourced semiconductor assembly or test plant in Malaysia, Indian and Malaysian news reports said at the time.Last year India exported $7.32 billion in goods, mainly in engineering and petroleum products, said the India Brand Equity Foundation.Imports from Malaysia amounted to $12.54 billion, mainly minerals, vegetable oil and electrical machinery and equipment.Malaysia also has a large Indian-origin population, around 6.8 percent, or almost three million people, official statistics said.”This living bridge… of diaspora is a great strength for us. The steps taken for their welfare lend a human foundation to our relationship,” Modi said.

Indian farmers have expressed concern that New Delhi has made too many concessions to Washington after the two countries brokered a new trade deal that would lower tariffs.Under the terms of the deal that was laid out in a joint statement from both countries released on Saturday, India will “eliminate or reduce tariffs on all US industrial goods” and other food and agricultural products.Meanwhile, the US will apply a reciprocal tariff rate of 18 percent on goods from India, including textiles and apparel, leather and footwear, plastic and rubber, organic chemicals, and certain machinery, the joint statement added. The terms were released after US President Donald Trump announced a trade deal with India, stating that Prime Minister Narendra Modi had promised to halt Russian oil purchases.Modi lauded the new trade deal in a post on the social media platform X later on Saturday, saying it would open up opportunities and generate jobs.But Indian farmer unions weren’t convinced, calling the deal a “total surrender” to American agricultural giants. “Indian industry, agriculture… are now under grave threat of cheap imports that will be dumped into Indian markets,” the Samyukt Kisan Morcha (SKM), a coalition of multiple farmers’ unions, said in a statement following the announcement.The group also called on farmers to join a nationwide protest on February 12.- What’s on the table? -The joint statement states that India will “eliminate or reduce” tariffs on a “wide range of US food and agricultural products”.This includes tree nuts, some fresh fruit, soybean oil, wine, spirits and other “additional products” that were not specified.Siraj Hussain, a former agriculture ministry top official, said Indian consumers were purchasing more nuts, “so it’s import may not have much impact on local production”, and will help satisfy high demand. Domestic growers do worry, however, about cheap imports on items such as apples, which they believe could have dire impacts on local producers. “Import of fresh fruits such as apples… will ruin the farmers,” SKM said. Officials hope safeguards included into the agreement — such as import quotas or minimum import prices for commodities including apples — will reduce the impact of foreign competition. New Delhi’s promise of lower duties on dried distillers’ grains and red sorghum for animal feed could also reduce the need for local soybean meal. Opposition lawmaker Jairam Ramesh said the move to ease imports of dried distillers’ grains and soybean oil would hurt “millions of soybean farmers” in key Indian states such as Maharashtra and Madhya Pradesh.- What’s off the table? -To stem concerns, India’s Trade Minister Piyush Goyal reassured farmers that their interests would be safeguarded, adding that the key red lines that had been drawn by New Delhi had not been crossed. He said “no concessions” had been extended in “sensitive areas” such as grains, spices, dairy, poultry, meat and several vegetables and fruits — including potatoes, oranges and strawberries. The trade minister also said genetically modified crops were not part of the agreement.This includes GM soybean, which the US has searched hard to find new markets for.- Small farms ‘can’t compete’ -While the farm sector contributes just 16 percent to India’s GDP, it provides livelihood to over 45 percent of the population. This makes the industry a key voting bloc often wooed by political parties. Farmer groups have also shown, on multiple occasions, that they are a street force to be reckoned with. In 2021, the government abandoned plans to reform the sector after months of intense protests that blocked the national capital’s highways and led to Delhi’s historic Red Fort complex being stormed by tractors. “Indian farms are very small and they can’t really compete with highly subsidised US agriculture,” Hussain, the former agriculture ministry official, said.- India and US trade -Between January-November 2025, when New Delhi was negotiating with Washington, Indian imports of American agricultural goods rose 34 percent year-on-year, raking in just under $2.9 billion. Top imports included cotton, soybean oil, ethanol and various nuts such as almonds. This happened even before the trade deal, although the rise is partly due to India reducing tariffs on some of these US items. Experts have said that a further reduction on duties for products such as soybean oil, which was announced in the joint statement, will likely lead to a jump in goods being imported by India from the US. 

A South Korean cryptocurrency exchange apologised on Saturday after mistakenly transferring more than $40 billion worth of bitcoin to users, which briefly prompted a selloff on the platform.Bithumb said it accidentally sent 620,000 bitcoins, currently worth more than $40 billion, and blocked trading and withdrawals for the 695 affected users within 35 minutes after the error occurred on Friday.According to local reports, Bithumb was meant to send about 2,000 won ($1.37) to each customer as part of a promotion, but mistakenly transferred roughly 2,000 bitcoins per user.”We sincerely apologise for the inconvenience caused to our customers due to the confusion that occurred during the distribution process of this (promotional) event,” Bithumb said in a statement.The platform said it had recovered 99.7 percent of the mistakenly sent bitcoins, and that it would use its own assets to fully cover the amount that was lost in the incident.It admitted the error briefly caused “sharp volatility” in bitcoin prices on the platform as some recipients sold the tokens, adding that it brought the situation under control within five minutes.Its charts showed the token’s prices briefly went down 17 percent to 81.1 million won on the platform late Friday.In a separate statement released later on Saturday, Bithumb said some trades were executed at unfavourable prices for users due to a price drop during the incident Friday, including “panic selling”.The platform said it would compensate affected customers, covering the full price difference as well as a 10-percent bonus.It estimated losses at about 1 billion won.The platform earlier stressed that the incident was “unrelated to external hacking or security breaches”.Bitcoin, the world’s biggest cryptocurrency, sank this week, wiping out gains sparked by US President Donald Trump’s presidential election victory in November 2024.

The Dow surged above 50,000 points for the first time Friday, shrugging off worries connected to artificial intelligence companies while traders focused on the prospects for US growth and Federal Reserve interest rate cuts.The index, the oldest of the three major US equity indices, powered to the landmark level shortly before 1930 GMT, retreated a bit below 50,000 points and then pushed even higher to close the day near session highs.It ended at 50,115.67, up more than 1,200 points, or 2.5 percent.The 50,000 mark constitutes “a nice big number,” said Briefing.com analyst Patrick O’Hare. “What it really reflects is a market that’s broadening out and buying into the growth story.” The landmark in New York came on a mixed day for global stocks, while bitcoin and precious metals both won significant gains, extending a period of volatility across markets.US stocks had been under pressure this week, with the Nasdaq falling the last three sessions following big drops in software equities and some tech giants related to the AI push. On Friday, Amazon was the biggest loser on the Dow, falling 5.6 percent after announcing it planned $200 billion in capital spending in 2026 to build up AI capacities.While investors continue to worry Amazon and other AI “hyperscalers” may not see a sufficient return on massive investments, their plans will bolster infrastructure, banking and other sectors.Caterpillar, 3M, JPMorgan Chase, Goldman Sachs, Amgen and Nvidia all rose at least four percent Friday.The AI plans mean “massive amounts of money are going to be deployed and that filters out to other companies,” said O’Hare. Gina Bolvin, of Bolvin Wealth Management, said Friday’s gains showed “confidence is real” in terms of the outlook for earnings growth.”Equity investors are likely to be rewarded — but the path won’t be smooth,” Bovin said in a note. “Volatility should be expected. For investors, this is a reminder to stay intentional: lean into quality businesses with strong earnings power and be prepared for more rotation, not straight-line gains.”Earlier milestones for the Dow include when it hit 40,000 points in May 2024 and 30,000 points in November 2020.The index has risen fairly steadily for most of the last two and a half years with the exception of the period around Donald Trump’s April 2025 “Liberation Day” tariff proposals, which the president later walked back.”CONGRATULATIONS AMERICA,” Trump said in a social media post celebrating Friday’s benchmark. Elsewhere, both gold and silver rebounded after bruising drops on Thursday, joining bitcoin, which climbed back above $70,000 after dropping to around $60,000 the prior day.After steep losses Thursday, European markets all pushed higher, while Asian bourses were mixed.In company news, shares in Jeep maker Stellantis plunged over 24 percent in Paris after it warned of a 22-billion-euro ($26-billion) write-down due to misjudging the shift in demand to electric vehicles.Stellantis shares are now down around 80 percent over the past two years.Meanwhile, shares in British-Australian mining giant Rio Tinto finished flat in Sydney after it dropped merger talks with Swiss resources firm Glencore. The deal would have created the world’s biggest mining firm, worth about $260 billion.Rio Tinto’s London-listed stock edged 0.3 percent higher on Friday, while Glencore climbed 1.5 percent, clawing back some of the previous day’s losses.Toyota jumped two percent in Tokyo after hiking profit and sales forecasts for the current fiscal year despite the impact of US tariffs.- Key figures at around 2115 GMT -New York – Dow: UP 2.5 percent at 50,115.67 (close)New York – S&P 500: UP 2.0 percent at 6,932.30 (close)New York – Nasdaq Composite: UP 2.2 percent at 23,031.21 (close)London – FTSE 100: UP 0.6 percent at 10,369.75 (close) Paris – CAC 40: UP 0.4 percent at 8,273.84 (close)Frankfurt – DAX: UP 0.9 percent at 24,721.46 (close)Tokyo – Nikkei 225: UP 0.8 percent at 54,253.68 (close)Hong Kong – Hang Seng Index: DOWN 1.2 percent at 26,559.95 (close)Shanghai – Composite: DOWN 0.3 percent at 4,065.58 (close)Euro/dollar: UP at $1.1825 from $1.1777 on ThursdayPound/dollar: UP at $1.3615 from $1.3531Dollar/yen: UP at 157.09 yen from 157.04 yenEuro/pound: DOWN at 86.82 pence from 87.04 penceWest Texas Intermediate: UP 0.4 percent at $63.55 per barrelBrent North Sea Crude: UP 0.7 percent at $68.05 per barrelburs-jmb/nro

The EU said Friday that TikTok needs to change its “addictive design” or risk heavy fines under the bloc’s digital content rules, drawing a sharp pushback from the Chinese-owned platform.In preliminary conclusions of a probe opened two years ago, the European Commission said it found TikTok was not taking effective steps to address the app’s negative impacts, especially on minors and vulnerable adults.”TikTok’s addictive design is in breach of the Digital Services Act,” said commission spokesperson Thomas Regnier, citing concerns with features such as infinite scroll, autoplay, push notifications, and a highly personalised recommender system.”These features lead to the compulsive use of the app, especially for our kids, and this poses major risks to their mental health and wellbeing,” Regnier said, adding: “The measures that TikTok has in place are simply not enough.”TikTok rejected the commission’s findings, with a spokesperson saying it presented “a categorically false and entirely meritless depiction of our platform”.”We will take whatever steps are necessary to challenge these findings through every means available to us,” they added in a statement.Allies of US President Donald Trump in the US Congress said the European Commission’s “punitive actions” were a pretext for curbing political speech and pressuring companies.The DSA is part of a bolstered legal armoury adopted by the EU in recent years to curb Big Tech’s excesses, and officials had until now said TikTok was cooperating with the bloc’s digital regulators.TikTok will now have access to the EU’s findings in order to defend itself against the claims.EU tech chief Henna Virkkunen told reporters that “TikTok has to take actions, they have to change the design of their service in Europe to protect our minors and their wellbeing”.The commission gave examples of what the platform could alter, such as: — the platform’s “infinite scroll” offering users an uninterrupted feed– implementing effective “screen time breaks”, including during the night– adapting its recommender system, the algorithms used by platforms to feed users more personalised content.- ‘Compulsive use’ of TikTok -The February 2024 investigation was the first opened into TikTok under the DSA, the bloc’s powerful content moderation law that has faced the wrath of the US administration under President Donald Trump.In presenting the probe findings, Regnier cited what he called “extremely alarming” statistics on the app’s use in the EU.TikTok was “by far” the most-used platform after midnight by children between 13 and 18, he said, with seven percent of children aged 12 to 15 spending four to five hours daily on it. Brussels accused TikTok of disregarding “important indicators of compulsive use of the app” such as the time minors spent on the platform at night.It also said TikTok had not implemented effective measures to mitigate risks, taking particular aim at screen time management and parental control tools.Its time management tools were “easy to dismiss” including for young users, the commission found, while parental controls required “additional time and skills from parents to introduce” them.- ‘Safe by design’ -The findings come as several European countries move to curb access to social media for younger teenagers, with officials weighing whether it is time to follow suit at EU level.Briefing reporters Friday, Virkkunen said her priority was to make platforms safe for all users, children included.”Social media should be so safe by design that we shouldn’t have that kind of very high age restriction,” she said.If the regulator’s views on TikTok are confirmed, the commission can impose a fine of up to six percent of the company’s total worldwide annual turnover.The EU began a separate probe into TikTok in December 2024 on alleged foreign interference during the Romanian presidential elections.EU spokesman Regnier said earlier this week that TikTok was “extremely cooperative” during that investigation and was taking measures to address the commission’s concerns.He added that while the probe remained open, regulators could monitor how TikTok behaves during other elections.

Bitcoin, the world’s biggest cryptocurrency, sank this week, wiping out gains sparked by Donald Trump’s presidential election victory in November 2024. The digital currency slumped to $60,033.01 on Friday before trimming losses, and is down around half from its October peak above $120,000. AFP explains why prices have fallen.- End of Trump rally -Digital currencies soared after Trump’s election victory as he was widely viewed as a strong supporter of the technology.  He publicly celebrated bitcoin crossing $100,000 for the first time in December 2024.But the rally suffered a sharp setback in April after Trump announced sweeping US tariffs, rattling markets worldwide. Bitcoin later resumed its march higher along with stocks and other markets, and hit a record of $126,251.31 six months later.But enthusiasm has faded as investors grow impatient over regulatory uncertainty.While the US Congress passed a law in July to regulate stablecoins — a form of cryptocurrency backed by traditional assets — a broader crypto bill, the Clarity Act, has stalled in the Senate.”A key test for Bitcoin’s ability to sustainably recover will be the passage of the Clarity Act,” said Deutsche Bank analysts Marion Laboure and Camilla Siazon. – Domino effect -The recent slide in precious metals like gold and silver — as investors locked in profits after their meteoric rise — was one of the main triggers for bitcoin’s slump.That pullback sent many investors rushing to sell cryptocurrencies and other risky assets to help raise cash.”This break is not happening in a vacuum, but in a context of widespread mistrust,” said John Plassard, head of investment strategy at Cite Gestion Private Bank.”Volatility in technology and precious metals is fuelling a global movement to reduce risk.”The sell-off has been intensified by forced deleveraging, as investors who borrowed money to bet on bitcoin’s rise are forced to sell when losses mount, pushing prices lower.- Tech contagion -Cryptocurrency declines gathered pace this week as investors sold tech stocks on renewed concerns over an artificial intelligence bubble.Analysts noted that bitcoin and AI-related stocks often move in the same direction.  “In recent years, liquidity has flowed across digital assets and advanced tech stocks at the same time,” said Kathleen Brooks, research director at trading group XTB.”This means that both asset classes share a tight financial link.”Michael Burry, the entrepreneur who gained fame for spotting the 2008 subprime mortgage crisis, fanned fears on Monday as he flagged a possible “death spiral” for bitcoin.- Crypto firms in focus -The downturn has raised questions about the viability of digital asset treasury firms, which stockpile cryptocurrencies in a bet that prices will keep rising. Many of these firms are “sitting on significant unrealised losses,” said Charlie Sherry, head of finance at BTC Markets.If these firms are forced to sell their bitcoin holdings to stay afloat, it could flood the market and amplify a downward spiral in prices.Shares in Strategy, which holds more than 713,000 bitcoins, plunged more than 17 percent on Friday after it reported a $12.4 billion net loss linked to crypto declines.And US cryptocurrency exchange Gemini announced Thursday that it would slash roughly a quarter of its workforce and withdraw from several international markets amid the downturn in digital assets.

German exports to the United States plunged in 2025 amid President Donald Trump’s tariff blitz, driving down the trade surplus of Europe’s top economy with the crucial US market to a four-year low, data showed Friday.Exports to China also fell, but total exports rebounded by around one percent following two years of contraction, as stronger trade with Europe offset falling shipments to the world’s two biggest economies, statistics agency Destatis said.The overall picture for Germany’s foreign trade remains bleak, experts warn, at a time the traditional export power is struggling after a long decline driven by a manufacturing slump, high energy costs and weak demand at home and abroad.German exports to the United States fell 9.3 percent last year compared to 2024, and totalled around 147 billion euros ($173 billion), while US imports to Germany rose slightly. The trade surplus with the United States was 52.2 billion euros, its lowest level since 2021, after a record surplus the previous year of nearly 70 billion euros. “Higher US tariffs are making German goods less competitive on the US market,” Commerzbank economist Ralph Solveen told AFP.As a result, China returned as Germany’s biggest trading partner last year, overtaking the US, according to the preliminary data.Europe was in Trump’s crosshairs when he launched his tariff onslaught as it runs a hefty trade surplus with the United States, much of it due to German exports. Under a deal struck in July, EU exports to the United States face a baseline levy of 15 percent — far higher than before Trump’s return to office.It was a heavy blow for Germany, whose firms, from well-known automakers and machinery giants to smaller, family-owned companies, have long relied on robust trade with the United States. According to data released previously by Destatis, exports of German cars and car parts to the United States dropped 17.5 percent between January and November from a year earlier. Exports of machinery were down nine percent and shipments of chemical products fell over 14 percent in the same period. – China challenge – German businesses have struggled in the Chinese market due to the emergence of homegrown rivals and weak consumer demand — German exports to China were down 9.3 percent last year.But Chinese exports to Germany jumped nine percent, as firms are increasingly redirecting goods to European markets due to Trump hiking tariffs on Chinese imports.German exports to other EU countries rose around four percent last year, driving the slight improvement in the overall figure.Germany’s trade surplus narrowed to 200.4 billion euros in 2025, a reduction of around 40 billion euros from a year earlier.In other news Friday, German factory output dropped 1.9 percent in December from the previous month, according to Destatis, sharper than forecasts and a disappointment after three months of gains.But ING economist Carsten Brzeski said the drop was “only a temporary halt and not a new downward trend”.”In fact, German industry is at the start of a clear cyclical upswing,” he said.The German government expects the economy will grow one percent this year after several bleak years, and other recent data — from industrial orders to quarterly growth — have painted a rosier picture.  Chancellor Friedrich Merz, who is pushing a major fiscal stimulus and reform drive, struck an optimistic tone Friday.Recent signs of a turnaround “encourage and embolden me to continue on this path of reforms and of changing the conditions for investment and for jobs in Germany” Merz said during a visit to Abu Dhabi.”We are still far from where we want to be, but we are on the right path.”