In recent developments, Bank of Japan board member Toyoaki Nakamura cautioned against raising interest rates, citing mounting risks from U.S. tariffs.

The UK economy expanded by 0.7% in Q1 2025, surpassing expectations of 0.6% and marking its strongest quarterly growth in nine months. The gains were led by services, particularly administrative services (+3.3%) and retail trade (+1.5%), as well as a 1.1% rise in industrial production, driven by transport equipment and machinery. Investment also played a key role, with gross fixed capital formation up 2.9%, supported by aircraft imports and ICT-related spending. Exports rose 3.5%, outpacing a 2.1% rise in imports, while household consumption grew slightly by 0.2%. Year-on-year GDP increased by 1.3%.

Data released on Tuesday showed headline inflation eased to 2.3% in April, marking its lowest level since February 2021 and coming in just below market expectations of 2.4%. On the trade front, investors continued to evaluate the implications of the temporary U.S.-China tariff reduction, which lowers tariffs to 30% and 10%, respectively, for a 90-day period.