Indian Prime Minister Narendra Modi addressed the nation, urging citizens to suspend gold purchases and cut fuel consumption for at least one year. In his speech, Modi also recommended that people avoid "non-essential" trips abroad to ease pressure on the country's foreign exchange reserves.

"We should refrain from buying gold jewellery regardless of the occasion," the prime minister said. The bold initiative is aimed at combating a widening trade deficit, which has worsened due to the conflict in the Middle East and soaring energy prices. Gold remains India's second‑largest import after oil, and the country is the world's second‑largest consumer of the precious metal.

Market reaction

The stock market reacted immediately to the prime minister's appeal, with the jewellery sector tumbling. Shares of the industry's largest player, Titan Co., plunged 6.6% in Mumbai trading. Senco Gold slumped 10.8%, and Kalyan Jewellers India dropped 9.5%.

Economic context

India is facing growing pressure on its currency. An energy shortfall and disruptions to oil shipments through the Strait of Hormuz are weighing on the rupee. At the same time, gold imports have already been restricted by administrative measures for banks. Such moves temporarily improved the trade balance in April.

Experts doubt the effectiveness of Modi's appeal because gold is deeply embedded in India's financial and religious culture. The precious metal is the primary savings vehicle for hundreds of millions of families, and its use at weddings is considered essential. An attempt by the government to curb demand for a "safe haven" during a geopolitical crisis may meet strong resistance from a population that commonly trusts bullion more than government bonds.

The American auto industry and lawmakers from both parties have united to block any attempts by Donald Trump to open the market to Chinese cars during the upcoming summit with Xi Jinping, as reported by Reuters.

The escalation of lobbying efforts was sparked by the US president's January comments in Detroit, where he suggested the possibility of Chinese factories being built in the United States. After years of erecting barriers such as tariffs and data security checks, the industry viewed these remarks as a threat of a "bad deal" with Beijing.

Senator Elissa Slotkin (D-MI) and a bipartisan group of 126 lawmakers are promoting legislation that classifies Chinese vehicles as "mobile data collection devices." According to the bill’s authors, modern cars record real-time infrastructure and citizen movements, making their import unacceptable from an intelligence standpoint.

US manufacturers, ranging from steelmakers to car dealers, are further alarmed by statistics from Europe and Mexico. In EU nations, the market share of Chinese brands doubled within a year, reaching 14% in Norway and 11% in the UK. In Mexico, the expansion of 34 brands from China has already captured 15% of the market.

With the average price of a new car in the US exceeding $51,000, affordable Chinese models pose an existential threat to Detroit. Unions and industry leaders are concerned that Trump might trade protections for the domestic market in exchange for promises from China to invest in job creation in "swing" states.

The US administration is attempting to de-escalate tensions. According to Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick, the topic of the auto industry is not on the agenda for negotiations. However, there remains a lack of trust within the industry. Businesses worry that the president is keeping "room to maneuver" for a headline-grabbing commitment to attract foreign investments. The business community is clear: any Chinese investment in the sector is seen as a Trojan horse threatening the American industrial base.

Artificial intelligence has emerged as an inflationary factor for the US economy, even before fully realizing its potential for productivity growth. According to a report from Goldman Sachs, this technology is driving consumer prices higher through three primary channels: electronics, software, and energy.

The bank estimates that the AI effect has already added 0.3 percentage points to the annual core personal consumption expenditures (PCE) price index and approximately 0.1 percentage points to the consumer price index (CPI). Analysts expect this trend to continue over the next 12 months.

Hardware and components: Surging demand for server infrastructure has created shortages in memory chips and batteries. According to Goldman Sachs, this will inevitably lead to higher prices for smartphones and PCs in the coming months.

"Markup" for AI solutions: Software developers have begun aggressively monetizing AI features. The bank cites the increased subscription costs for Microsoft 365, as well as price hikes from Adobe, Duolingo, and Intuit, all justified by the introduction of new tools.

Energy demand: The expansion of data centers has significantly increased the load on energy grids. Rising electricity costs in the United States could add another 0.1-0.2 percentage points to PCE inflation in the coming years.

Despite current pressures, Goldman Sachs analysts maintain a long-term optimistic outlook. They believe that over time, AI will become a deflationary force, as automation reduces production costs and enhances overall economic efficiency. In the short term, however, consumers will bear the costs associated with the infrastructure leaps made by tech giants.

The US Senate Banking Committee has scheduled a working session on the “Clarity Act” for May 14. The discussion set for 10:30 AM aims to resolve the long-standing conflict between the cryptocurrency industry and the traditional financial sector.

The legislation establishes clear jurisdictional boundaries between regulators by defining the status of tokens as securities or commodities. For market participants, the passage of this bill is critical, as the lack of a legal framework in the United States is hindering the development of the institutional sector.

A key provision in the agreement between Senators Thom Tillis and Angela Alsobrooks is the prohibition of interest on passive balances of stablecoins. This decision is driven by demands from the banking lobby, as financial institutions are concerned about competition between digital assets and traditional deposits. However, rewards for the active use of tokens (payment transactions) will remain legal.

Banking associations have already launched an aggressive campaign to persuade Republicans, arguing that any “interest loopholes” in the Clarity Act could result in massive liquidity withdrawals from the banking system and undermine financial stability.

The crypto community is pushing for the law to be finalized before the November midterm elections. The House of Representatives approved its version of the bill last summer, but the Senate must pass it by the end of 2026 for it to reach Donald Trump’s desk for approval.

However, hurdles remain due to objections from several Democrats, who are calling for stricter anti-money laundering regulations and limitations on officials affiliated with crypto projects. Nonetheless, Trump’s status as the “crypto president” makes his signing of the law highly likely if it clears the upper chamber of Congress.

China’s gold industry faced a decline in domestic production in Q1 2026, while investment demand rose in parallel. According to the China Gold Association, total output (including processing of imported raw material) fell 3.27% to 136.23 tonnes.

The main hit came at the mines, where production plunged 7.08%. The contraction was caused by widespread safety inspections and forced shutdowns of operations. Against this backdrop, national market players sharply scaled up overseas activity — Chinese companies’ foreign production jumped by more than 30%.

Investment boom vs. jewelry crash

The structure of domestic demand has undergone a radical shift. While total demand rose 4.41% to 303.29 tonnes, high market prices triggered a collapse of 37.1% in the jewelry sector. Consumers largely abandoned jewelry purchases in favor of physical bars and coins, whose sales soared 46.4%.

Official reserves

The People’s Bank of China (PBOC) remained an active buyer, adding another 7.15 tonnes to reserves in Q1. By the end of March, the country’s official holdings reached 2,313.48 tonnes, securing China the fifth spot among the world’s largest official gold holders.

Analysts point to a growing imbalance: regulatory pressure is restricting domestic supply while market volatility is turning gold into the primary safe‑haven asset for both households and the state. The current dynamics are forcing China to rely increasingly on external supplies and foreign mining.

Global stock markets hit record highs after reports of a possible peace agreement between the US and Iran. On hopes of a de‑escalation, crude oil prices for Brent and WTI plunged sharply.

US stock indices S&P 500 and Nasdaq set new intraday records on May 7, 2026, reaching 7,365.12 and 25,838.94, respectively. Bullish momentum was also seen across the Asia‑Pacific: Japan’s Nikkei 225 topped 62,000 for the first time in its trading history, and South Korea’s KOSPI posted a new all‑time high. Investors moved back into risk assets in the hope that trade relations will get back on track and geopolitical tensions will ebb away.  

At the same time, US crude WTI fell below the psychological $100 mark for the first time since April 28, 2026, closing at $95.08 per barrel. The international benchmark Brent plunged nearly 8% to $101.27 per barrel. Energy prices fell as the market priced in a near‑term restoration of maritime security and the end of blockades at key shipping chokepoints in the Persian Gulf.

Despite market optimism, the economies of Europe and Asia are still suffering from a protracted energy crisis and jet‑fuel shortages. Analytics firm Kpler recorded a 30% year‑on‑year slump in global jet fuel exports in April, totalling just 1.3 million barrels per day. The dramatic decline in shipments from Middle East terminals keeps pressure on the global aviation industry and limits the pace of recovery in air freight.

The global stock of debt rose by $4.4 trillion in the first quarter to a record $353 trillion. The world debt‑to‑GDP ratio remained at 305%, its 2023 level.

The Institute of International Finance (IIF) links the recent dynamics to heavy borrowing in the United States and a sharp acceleration in nonfinancial corporate debt growth in China. China’s debt burden reached an all‑time high of $36.8 trillion, driven largely by borrowing at state‑owned enterprises. The IIF report notes that investors are diversifying portfolios by reducing exposure to US government bonds. Besides, total global debt had climbed to a record by the end of March, nearly $353 trillion.

Medium‑term forecasts point to further increases in leverage due to population aging and rising spending on defense and energy security. Capital investment in artificial intelligence and the escalation of the Middle East conflict are also materially affecting borrowing volumes. Structural factors are expected to further drive up liabilities in both the public and corporate sectors of the global economy as of May 6, 2026.

According to François Villeroy de Galhau, a member of the European Central Bank Governing Council, rising oil prices do not have a significant impact on overall inflation in the euro area. The regulator has not found evidence that the current increase in energy costs justifies immediate monetary policy tightening.

In an interview with France 5, Villeroy de Galhau emphasized that the ECB is prepared to raise interest rates only if "second-round effects" emerge that could make inflation broad-based and persistent. The bank is closely monitoring whether rising commodity costs are passed on to industrial goods, food, and services, which account for 50% of consumption in the region. Villeroy de Galhau remarked, “If we see such second-round effects, we'll act and raise rates to prevent inflation becoming broad and sustainable.” Currently, there are no signs of systemic price pressure spreading throughout the bloc’s economy.

Last Thursday, the ECB left interest rates unchanged, postponing discussions about potential adjustments until its meeting on June 10-11, 2026. Within the leadership, there are polarized opinions: Bundesbank President Joachim Nagel advocates for a rate hike in the absence of improved growth forecasts, while Peter Kazimir from Slovakia describes such a move as “practically inevitable.” Meanwhile, Villeroy de Galhau is set to step down at the end of May 2026 and will therefore miss the June meeting. In a letter to French President Emmanuel Macron this week, the official stressed the need for a balance between caution and decisive action from the regulator.

The average retail price of gasoline in the United States has surpassed the psychological threshold of $4.50 per gallon for the first time since July 2022, with prices in California reaching $6.14. This sharp increase is driven by a 58% rise in global Brent crude prices since February 28, 2026, due to the blockage of the Strait of Hormuz.

The market situation is further complicated by domestic issues faced by oil refineries. According to Patrick De Haan, an analyst at GasBuddy, the closure of the Strait of Hormuz is steadily pushing oil and gasoline prices higher, with challenges at domestic refineries also contributing to the situation. A recent outage at BP’s Whiting refinery, with a capacity of 440,000 barrels per day, led to the shutdown of processing units, exacerbating local shortages.

Investment bank Morgan Stanley has reported an unusually rapid drawdown in fuel inventories across the country. In the last week of April alone, stocks fell by 6 million barrels, reaching 222.3 million barrels as of April 24, 2026. This figure is 2 million barrels below the five-year seasonal average. Meanwhile, demand remains stable, with average daily consumption over the past four weeks totaling 8.95 million barrels, which is 1% higher than the same period last year.

Electric‑vehicle maker Tesla may pay its CEO Elon Musk up to $158 billion in compensation for 2025. That sum would represent the first tranche under a new $1 trillion compensation package approved by the company’s shareholders.

The actual payout depends directly on meeting business targets. To receive the first portion, the market capitalization of Musk’s company must rise from the current $1.2 trillion to $2 trillion. The full amount would be payable only if the automaker reaches a market value of $8.5 trillion through successful mass production of robots and the market launch of driverless taxis.

News of the new $1 trillion incentive package emerged last autumn. Previously, Tesla approved granting the CEO 96 million shares. In August 2025, those shares were valued at roughly $29 billion, which Elon Musk would receive if he retains his position for two more years. Earlier, a Delaware court annulled another compensation award — twice as large — that he had publicly pledged to use to fund interplanetary travel.

China’s Ministry of Commerce has issued an official directive prohibiting any recognition, enforcement, or compliance with US sanctions imposed on five Chinese petrochemical companies. These American restrictions were slapped due to allegedly confirmed instances of oil trading with Iran.

The ministry explained its decision as a response to what it views as the unjust extraterritorial application of foreign laws. Officials stated that the actions of the United States disrupt healthy commercial activities and directly violate fundamental norms of international relations. Beijing’s stance is reinforced by a statement asserting, “China has always opposed illegal unilateral sanctions that lack a basis in international law and are not authorized by the UN Security Council.” In this context, the Ministry of Commerce has issued an order instructing that the US sanctions against five Chinese enterprises not be recognized, enforced, or complied with.

Earlier, US Ambassador to the United Nations Mike Waltz commented on potential retaliatory measures from the American government. Washington is considering starting inspections of cargo ships transporting oil from Iran to China.

Crypto exchange Coinbase Global Inc. announced a compromise in the US Senate on yielding interest on stablecoins. The agreement removes a key obstacle that had been blocking passage of a bill to structure the crypto market.

At the center of the dispute was the practice of paying custody rewards on digital assets. The traditional banking sector actively lobbied to ban such payments, fearing a mass liquidity outflow from ordinary deposits into higher‑yielding crypto products.

Deal terms

Under the new arrangements, crypto platforms will keep the right to offer yield to customers, but the rules governing how those yields are paid will be tightened considerably in line with banking safety standards. Coinbase Chief Policy Officer Farhad Shirzad stressed that the deal allows users to receive bonuses for “genuine network usage” without turning stablecoins into direct analogs of bank deposits.

Regulatory consequences

Breaking the impasse paves the way for a vote in the Senate Banking Committee. The bill is intended to clarify the allocation of authority between the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC). A clear jurisdictional split is expected to reduce regulatory pressure on the industry that has persisted for several years.

Analysts view the compromise as recognition of the growing role of digital assets in the US financial system, with lawmakers attempting to protect Wall Street’s interests while not blocking technological development.

The US economic growth accelerated in the first quarter, recovering from stagnation caused by the winter shutdown. According to data from the Bureau of Economic Analysis, gross domestic product increased by 2% year-over-year, up from 0.5% in the previous quarter, although it fell short of the forecasted 2.2%.

This growth was bolstered by compensatory increases in government spending following a 43-day government shutdown, as well as a boom in the construction of data centers to support artificial intelligence needs. The IT infrastructure essentially offset the decline in consumer activity, which began in February amid the war in Iran.

A major negative signal was a sharp spike in prices. The Personal Consumption Expenditures (PCE) price index reached 3.5% in March, reflecting a surge in gasoline prices above $4 per gallon. The blockade of the Strait of Hormuz, along with US and Israeli military actions against Tehran, continues to exert pressure on the energy market, fueling inflationary expectations.

The core PCE price index, which excludes volatile items and fuel, rose to 4.3% in the first quarter, surpassing market expectations of 4.1%. Analysts at CIBC describe this level as “uncomfortably high” for the Federal Reserve, raising questions about any potential easing of monetary policy.

Despite inflationary pressures, investors continue to view the US dollar as a safe-haven asset. The status of the United States as the largest exporter of energy creates an illusion of insulation from global shocks, ensuring a steady capital influx. However, experts predict further cooling of consumption, as American households are forced to reallocate budgets in favor of rising fuel costs, which is likely to slow the economy in the second quarter.

The gap between capital spending on artificial intelligence (AI) and its real payback is becoming critical. According to a Goldman Sachs report, financial returns remain minimal across most sectors despite the unprecedented pace of technology adoption.

The bank’s analysts note that 95% of companies embracing AI have yet to record a notable return on investment (ROI). Although mass consumers are adopting AI faster than they did the internet or personal computers, monetization is stalling. Most users prefer free versions of chatbots, which limits revenue generation for developers.

Ecosystem imbalance

Right now, the bulk of profits in this cycle is grabbed by chipmakers. Model developers and cloud providers, by contrast, are increasingly struggling to justify the enormous infrastructure costs. Goldman Sachs calls this skew in the value chain “unsustainable.”

Things are dubious within the corporate sector. While top executives report productivity gains, front‑line staff do not admit real-time savings. Most companies still have not found AI use cases that create genuine added value rather than merely increasing operating costs.

FOMO and infrastructure risks

Large high-tech companies continue to ramp up spending on data centers despite stagnant share prices. Analysts attribute this to fear of missing out (FOMO) and the need to keep pace in a competitive race.

Experts warn that without deep reorganization of corporate data and clear investment strategies, AI spending will remain inefficient. Early adopters might encounter high costs while implementing raw solutions that will not deliver proportional long‑term benefits. Experts urge companies to be cautious: buying powerful tools does not substitute for lacking business logic.

US President Donald Trump has directed his administration to devise a plan for a prolonged pressure campaign on Iran’s economy, shifting the focus from direct military intervention to long-term economic suffocation. According to US officials, the new strategy aims for a radical reduction in Iranian oil exports and strict limitations on port shipping. Washington views the transition to a thorough blockade as the optimal pressure tactic, given that resuming extensive bombing carries unacceptable geopolitical risks, and the prospects for a swift diplomatic resolution remain elusive following the April ceasefire.

The escalation of tensions is linked to the US administration’s rejection of a three-phase de-escalation plan proposed by Tehran. The Iranian initiative called for the immediate reopening of the Strait of Hormuz in exchange for a postponement of nuclear negotiations. However, Washington deemed these concessions insufficient and categorically refused to soften its key demand—a twenty-year moratorium on uranium enrichment accompanied by indefinite international oversight. Experts warn that such uncompromising stances could lead the conflict into a protracted phase with no clear prospects for a peace agreement.

News of the impending long-term blockade immediately impacted the global energy market, where a sharp supply shortage has already developed due to the blockage of the Strait of Hormuz. Market prices surged dramatically: Brent crude futures rose by 2.9%, reaching $114.46 per barrel, while US West Texas Intermediate surged to $102.79. Maintaining the status quo is expected to keep global hydrocarbon prices at abnormally high levels in the medium term.

Beijing has warned the European Union that it is ready to take tough retaliatory measures if Brussels adopts legislation to ban the use of telecommunications equipment from Huawei Technologies. China’s mission to the EU in Brussels has demanded that the European Commission remove wording from draft documents that would classify Chinese products as cybersecurity threats and label Chinese vendors as high‑risk suppliers. The escalation underscores a growing likelihood of a large‑scale trade confrontation.

The initiative by European Commission Executive Vice President Henna Virkunen aims to create legal mechanisms obliging member states to fully exclude Huawei and ZTE equipment from national telecom infrastructures. Measures proposed under the EU cybersecurity law are directive in nature — effectively converting the non‑binding 2020 5G security recommendations into strict regulatory requirements for all participants in the single European market.

Beijing has explicitly warned it may launch economic investigations against European corporations if the new rules force operators to dismantle already-installed network nodes. Implementing such threats could inflict critical damage on the operational activities of EU businesses in the Chinese market. While the United Kingdom and several European countries have already independently restricted Huawei’s presence in sensitive sectors, an EU‑wide ban risks triggering a full‑scale tech war and disrupting global supply chains.