May 14, 2026

Donald Trump and Xi Jinping met in Beijing

International

During their bilateral meeting in Beijing, the US president and his Chinese counterpart agreed on the importance of ensuring global energy stability through the opening of the Strait of Hormuz. On economic matters, both leaders expressed a willingness to collaborate on establishing mechanisms to prevent further tariff escalations. Regarding Taiwan, the delegations presented differing approaches: while the Chinese side emphasized the importance of careful management to maintain stability, the US reports focused on progress in the economic and regional agenda. Finally, the two leaders shared a state banquet at the Great Hall of the People.

Meanwhile, yesterday the US Senate confirmed Kevin Warsh as the next chairman of the Federal Reserve, with a 54-45 vote that largely followed party lines. Warsh, a former Fed governor and close ally of President Trump, will assume the position this Friday following the end of Jerome Powell's term, at a time of pressure from persistent inflation and the administration's demands to lower interest rates. It is worth noting that Jerome Powell will step down as chairman of the Federal Reserve, but will remain governor and continue to participate with one vote in monetary policy meetings.

Regarding economic data, it is worth highlighting that the Producer Price Index (PPI), also known as wholesale inflation, was released yesterday in the United States, and it surprised on the upside for April. The overall measurement came in at +1.4% month-on-month and +6.0% year-on-year, compared to expectations of +0.5% and +4.8%, respectively. Meanwhile, the core measurement, which excludes food and energy, was +1.0% month-on-month and +5.2% year-on-year, also exceeding the expected figures of +0.3% and +4.3%, respectively.

The main stock indices closed with mixed results yesterday. The S&P 500 rose 0.6%, while the Nasdaq gained 1.2% on the same day. The Dow Jones, meanwhile, saw a slight decline of 0.1% yesterday. Year-to-date, the indexes have accumulated gains of 8.7%, 13.6%, and 3.4%, respectively.

Meanwhile, US Treasury yields were virtually unchanged on Wednesday. The 1-year Treasury note closed at 3.78%, unchanged from the previous day, while the 3-year Treasury note closed at 4.02%, just below Tuesday's 4.03%. The 10-year Treasury note, however, rose slightly from 4.46% to 4.47%.

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