The Price of Things.

Weapons of choice.

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1. China’s trade surplus in goods has surpassed $1 trillion this year for the first time, as exports boomed despite US President Donald Trump’s tariff war. In the first 11 months of this year, China’s trade surplus in dollar terms was $1.076 trillion, according to data released on Monday by the country’s customs administration, which covers goods but not services. China’s trade surplus in goods for the full year in 2024 was just shy of $1 trillion. The record surplus comes in the wake of a de-escalation in trade tensions between Washington and Beijing, which agreed a yearlong truce in October. (Source: ft.com)

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2. The Bank of Japan’s signal that it could soon raise interest rates again has added fuel to a brutal sell-off in the country’s bonds this year and sent a tremor through global financial markets. Governor Kazuo Ueda on Monday used language taken by many economists as a clear indication he is preparing markets for a move before the year is out. Swaps markets are now pricing in a two-thirds chance of a rate rise this month. After years of negative interest rates, which only ended last year and which allowed investors to borrow cheaply to buy higher-yielding foreign assets, global markets are now bracing themselves for the fallout from higher Japanese borrowing costs. (Source: ft.com)

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3. US natural gas prices are soaring as the country ships record amounts of the fuel overseas, contributing to an affordability crisis that is causing political problems for Donald Trump. Wholesale prices have jumped more than 70 per cent in the past 12 months, with the US benchmark Henry Hub price settling at $5.29 on Friday, its highest level since December 21 2022 during the energy crisis sparked by Russia’s full-scale invasion of Ukraine. (Source: ft.com)

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4. Brookings Institute:

We measure cost of living using the Economic Policy Institute’s Family Budget Calculator—an annually updated, inflation-adjusted estimate of the cost of basic necessities for a household depending on the number of workers and children as well as where they live. Compiling these cost-of-living estimates with anonymized microdata from the U.S. Census Bureau’s 2023 American Community Survey data, we analyze how much of middle-class incomes are spent on basic necessities across metro areas, disaggregating by race and family size. This analysis looks at 160 metropolitan areas that are home to at least 100,000 households. Our analysis finds the overall share of middle-class households that do not make enough to afford basic necessities where they live ranges from 23% to 57%. Therefore, a household defined by income as middle class may not feel they are middle class as they struggle to make ends meet. Our analysis shows that there is no major city in the country where 100% of the middle class can afford basic necessities. Affordability, therefore, is not only an issue in the largest or richest cities such as New York or San Francisco, but extends to 160 metro areas covering every state. (Source: brookings.edu)

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5. New polling shows many Americans have begun to blame President Donald Trump for the high costs they’re feeling across virtually every part of their lives — and it’s shifting politics. Almost half — 46 percent — say the cost of living in the U.S. is the worst they can ever remember it being, a view held by 37 percent of 2024 Trump voters. Americans also say that the affordability crisis is Trump’s responsibility, with 46 percent saying it is his economy now and his administration is responsible for the costs they struggle with. Those are among the new results from The POLITICO Poll that crystallize a growing warning sign for Republicans ahead of next year’s midterms: Some of the very groups that powered Trump’s victory last year are showing signs of breaking from that coalition, and it’s the high cost of living that’s driving them away. (Source: politico.com)