🌍 Week of July 1, 2025 – “Trade Progress, Employment Watch, Policy Pivots & Debt Risks” 🔍

Korea eyes trade stabilization and fiscal action, while the U.S. braces for key employment data and lingering tariff volatility.

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📌 1. Korea’s Export Recovery & Trade Negotiation in Focus

• South Korea’s June exports are expected to rise +4.7% YoY, led by semiconductors (+21.8%) and autos (+9.2%) (Reuters).
• The Korea–U.S. tariff negotiation, which concludes by July 8, is progressing, reducing trade-related uncertainties.

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📌 2. Korean Cabinet Reshuffle & Fiscal Stimulus in Motion

• President Lee appointed Koo Yun-cheol as the new Finance Minister to accelerate emergency economic response.
• A ₩14.7 trillion supplementary budget is being pushed to stimulate summer consumption (Reuters).

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📌 3. Financial Risks & BoK Liquidity Expansion

• A Bank of Korea board member warned of systemic risks from rising household and real estate debt.
• The BoK will implement expanded 14-day RP (repurchase) operations from July 10 to stabilize short-term liquidity (Reuters).

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📌 4. Digital Finance Momentum – Stablecoin in Discussion

• BoK Vice Governor Ryu Sang-dae proposed a gradual rollout of KRW-backed stablecoins via local banks, signaling a potential digital finance transformation.

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📌 5. U.S. Labor Market Data & Holiday Schedule

• The June nonfarm payroll report (July 3) is expected to show moderate job growth with a slight rise in unemployment to 4.3%.
• U.S. markets will close early on July 3 (1:00 p.m. ET) and remain closed on July 4 for Independence Day. (Kiplinger)

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📌 6. Post-Rally Volatility & Legislative Deadlines

• After a two-month rally, S&P 500, Nasdaq, and Dow hit all-time highs, but July brings new risk:
  • Tariff expiration (July 9)
  • U.S. fiscal bill gridlock (Trump’s “Big Beautiful Bill” may not pass before July 4)
  • Q2 earnings season approaching
    (MarketWatch)

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🔮 Key Events & Market Watch

DateEventMarket Relevance

July 1	Korea’s June trade report	Confirming export rebound; currency support
July 3	U.S. June jobs report (NFP)	Fed rate outlook and sentiment swing risk
July 4	U.S. market closed	Lower global liquidity, low volume trading
July 8	Korea–U.S. tariff deal deadline	Major catalyst for exporters and KRW/USD
July 9	U.S. tariff moratorium ends	Trade-related volatility risk
July 10	BoK’s RP injection begins	Short-term liquidity improvement signal
Mid-July	U.S. Q2 earnings season	Tech megacaps and margin trends in spotlight

 

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💡 Investment Strategy Recommendations

1. Position around trade-sensitive sectors
   • Focus on semiconductors, autos, chemicals, and shipbuilding.
2. Target fiscal policy beneficiaries
   • Play construction, infrastructure, fintech, and telcos.
3. Watch for financial leverage risks
   • Trim overleveraged real estate/financial names; hedge selectively.
4. Brace for global volatility
   • Prepare for swings around NFP, tariff deadlines, and policy updates.
5. Stick with long-term growth trends
   • Maintain allocations to AI, digital finance, biotech, aerospace (e.g., Korea’s KF-21).

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📝 Final Thoughts

The first week of July brings a crucial convergence of policy, macro data, and trade diplomacy.
Korea’s efforts to stabilize exports and inject fiscal stimulus are encouraging, while the U.S. faces pivotal decisions on labor, tariffs, and economic direction.
This is a week where agility in event trading meets stability through structural positioning.

Stay focused, stay informed, and may your investments thrive through the twists of July! 🙌