Crypto Bill Narrowly Passes, Shifting Global Capital Flows Under Spotlight

Market Overview

Robust U.S. retail sales data and a decline in weekly initial jobless claims sent both the U.S. dollar and equities higher. The S&P 500 and Nasdaq closed at record highs, while the yield on the 2-year Treasury rose more than 3 basis points, reflecting rate-sensitive movement. The U.S. dollar index gained 0.33%, recouping its losses from the previous day. Gold rebounded after an intraday drop of over 1.1% but still closed down 0.28%. Crude oil prices reversed earlier losses, with WTI rebounding nearly 2% from session lows. Meanwhile, cryptocurrencies saw a short-term surge following the U.S. Congress passage of a stablecoin regulatory bill.

Hot Topics to Watch● Passage of Three Major Crypto Bills

The Stablecoin Bill, also known as the “Genius Act,” recently received overwhelming support in the House, with the number of ‘yea’ votes more than doubling the ‘nays’. Over 100 Democratic representatives crossed party lines to support the legislation. However, on Wednesday evening, the three key crypto-related bills— including the Stablecoin Bill—barely passed in a procedural vote by a razor-thin margin of just five votes. Notably, in Tuesday's initial procedural vote, the bills had failed due to over a dozen Republicans opposing the motion. The narrow passage underscores the deep partisan divide and regulatory complexity surrounding stablecoin oversight in Congress.

● Foreign Investors Increase U.S. Treasury Holdings in May

The U.S. Treasury‘s latest TIC report (Treasury International Capital) revealed a strong surge in foreign purchases of U.S. government bonds during May, particularly by Canada. This suggests that despite concerns over potential disruptions from Trump administration policy shifts, overseas demand for Treasuries remains resilient. Total foreign holdings of U.S. Treasuries reached $9.05 trillion in May, up $32.4 billion from April, effectively erasing the prior month’s decline and marking the second-highest level on record.

Key Events to Watch (GMT+8)

20:30 – U.S. June Housing Starts (annualized, in thousands)

20:30 – U.S. June Building Permits (in thousands)

22:00 – U.S. July Preliminary 1-Year Inflation Expectations

22:00 – U.S. July Preliminary University of Michigan Consumer Sentiment Index