Korea’s Top 3 Battery Firms See Market Share Drop from 44.1% to 39%
China Grips Material Supply Chain, Rapidly Advances in Technology
Structural Weakening Visible Across Both Upstream and Downstream Industries

South Korea’s battery industry—once considered a linchpin of the nation's high-tech economy—is now confronting an existential crisis. Once lauded for leading global battery innovation, Korean firms are witnessing their dominance unravel under the pressure of China’s rapid rise. What started as a quiet erosion of market share has become a full-scale industrial reckoning. With Chinese battery makers gaining momentum in both scale and technological sophistication, and Korean EV manufacturers floundering under market volatility, the challenges now appear deeply structural rather than cyclical.

This is no longer just about outperforming rivals in quarterly numbers. It’s about survival. Without bold reforms and forward-looking strategies, South Korea risks not only falling behind—but being shut out from the future of global mobility altogether.

Chinese Latecomers Surge Ahead, Igniting K-Battery Crisis

The warning signs are clearly visible in market data. Between January and April 2025, global usage of EV batteries, excluding China, surged by 26.8 percent year-over-year to reach 132.6 gigawatt-hours. Yet during this period of strong global demand, Korea’s top battery manufacturers—LG Energy Solution, SK On, and Samsung SDI—saw their combined market share shrink from 44.1 percent to 39 percent.

LG Energy Solution remained the world’s second-largest battery supplier with 28.9 gigawatt-hours, marking a 15.6 percent year-on-year increase in usage. However, its market share declined from 23.9 percent to 21.8 percent. SK On also experienced growth, expanding by 24.1 percent to reach 13.4 gigawatt-hours, but its share edged down from 10.3 percent to 10.1 percent. Samsung SDI suffered the most, with its battery usage falling by 11.2 percent to 10.3 gigawatt-hours and its market share dropping from 11.1 percent to just 7.8 percent.

In stark contrast, Chinese battery manufacturers posted explosive gains. CATL’s battery usage rose by 36 percent to 39.3 gigawatt-hours. BYD achieved a staggering 127.5 percent increase, reaching 9.1 gigawatt-hours. Gotion High-Tech doubled its usage to 2.6 gigawatt-hours, while CALB rose by 47.1 percent to 2.5 gigawatt-hours. When the domestic Chinese market is included, the gap becomes even more stark. In the first quarter of 2025, CATL alone held a global market share of 38.3 percent—more than double the 18.7 percent combined share of Korea’s top three battery firms.

Industry analysts agree that Chinese firms have evolved far beyond basic cell assembly. Today, they are asserting themselves as leaders in battery innovation, armed with advanced technologies and an aggressive global investment strategy. The Korean battery industry, by contrast, is now being squeezed on three fronts: it must enhance its technological edge, secure diversified and resilient supply chains, and become more price competitive—all at once. According to SNE Research, China’s expansive overseas ventures and relentless investment represent a formidable new phase in global battery competition, suggesting that Korean firms may face further market share erosion if they fail to adapt.

Industry Alarm: "Korea Could Follow Japan’s Path of Decline"

Across Korea’s industrial circles, there is a growing acknowledgment that the country’s time at the top of the global battery hierarchy may be over. The competitive landscape has shifted. No longer is success solely determined by core cell technologies. The key battleground now includes control over battery materials, mastery of supply chains, and streamlined manufacturing efficiencies. On all these fronts, Korea’s response has lagged behind.

China, by contrast, has secured overwhelming control over the global supply of critical minerals such as nickel, cobalt, and lithium—resources essential for battery production. It has also achieved near-total dominance in the production of cathodes and anodes, leveraging both massive output and low prices to consolidate its grip on these crucial sectors.

In terms of next-generation battery technology, China is closing the gap with Korea at a rapid pace. From solid-state batteries and silicon anodes to advanced electrolytes, Chinese firms are catching up—and in some segments, they have already moved ahead. Companies like CATL and BYD are driving this leap forward with enormous research and development operations, generously supported by the Chinese government. Their technologies are increasingly shared with global automakers through OEM partnerships, accelerating their integration into the world’s EV platforms.

Korean battery firms, meanwhile, remain preoccupied with refining production yield. While operational efficiency is important, this narrow focus reveals a wider absence of strategic innovation. Many in the industry now fear that Korea is walking the same road as Japan, which lost its once-dominant battery position in the early 2000s due to stagnation in technological development and a lack of supply chain competitiveness.

Signs of a similar trajectory are already evident. Korean battery firms are losing ground, their market share slipping, and their influence over global supply chains diminishing. What is unfolding is not a short-term dip but a structural crisis. The absence of a bold, long-term roadmap for innovation, coupled with passive resource acquisition strategies, has left the industry vulnerable. Unless Korea fundamentally alters its course, many believe the label “the next Japan” may soon apply all too accurately.

EV Industry Shaken — Domino-Like Crisis Becomes Reality

The battery industry’s challenges are compounded by the turmoil in one of its most vital downstream markets: electric vehicles. As battery demand is inextricably linked to EV production, the weakening performance of major automakers has created a feedback loop of declining orders and stalled growth. Among the most visible victims of this trend is Hyundai Motor, South Korea’s leading car manufacturer.

Hyundai’s EV strategy has faced repeated disruptions. Despite earlier ambitions to aggressively capture a larger share of the global EV market, the company has struggled to gain meaningful traction. Ongoing confusion over strategic direction has led to multiple revisions of its production targets. The company is now reportedly preparing for a workforce reduction of up to 40 percent compared to original EV manufacturing plans—an alarming development that underscores the growing instability of Korea’s EV sector.

In contrast, China is leveraging its domestic EV market as a launchpad for global expansion. Companies such as BYD, Xiaomi, and Xpeng have rapidly increased their presence through aggressive low-cost strategies. These firms are not only satisfying domestic demand, but also penetrating global markets at a pace Korean automakers are struggling to match. Their success, in turn, is bolstering Chinese battery makers, who benefit from the expanded scale and sustained demand.

Central to China’s dominance is the tight integration between its EV and battery industries. These companies collaborate seamlessly across every stage of the supply chain, from cell manufacturing and material procurement to the design of battery management systems. This vertically integrated structure allows China to maintain a self-sufficient, demand-driven ecosystem that minimizes reliance on foreign partners and external volatility.

Korean firms, by contrast, remain locked in a contract-based supply structure dependent on foreign automakers. This model leaves them exposed to abrupt demand swings and weakens their ability to chart their own strategic course. Unlike their Chinese counterparts, they have yet to build a domestic ecosystem where battery production and EV manufacturing move in tandem.

As the future of mobility rapidly evolves, the consequences of these strategic differences are becoming painfully clear. South Korea is losing influence not only in batteries but also in electric vehicles—the two pillars of the next-generation transportation industry. What once seemed like temporary headwinds now appear to be a structural storm. The fear gripping the industry is no longer just about losing leadership. It is about being completely sidelined.

Key Nations Engaged in Talks During 90-Day Mutual Tariff Grace Period
“Final Notice Will Be Issued Without Extension Once Grace Period Ends”
South Korea Aims for Comprehensive Package Deal in July but Faces Negotiation Challenges

U.S. President Donald Trump has stated that there is no need to extend the deadline for mutual tariff negotiations, adding that he will send letters outlining trade deal terms to each country within a maximum of two weeks. In addition to the existing 50% tariffs on key home appliances such as washing machines and refrigerators, he also hinted at imposing additional tariffs on imported vehicles, on top of the current 25% rate, intensifying pressure on U.S. trade partners. With negotiations delayed due to the transition to the new administration, South Korea is racing to finalize a ‘July package’ deal, but the need to build negotiation leverage to keep pace with Washington’s accelerated timetable has emerged as a critical challenge.

Trump: “In Trade Talks with Japan, South Korea, and 13 Other Countries”

On the 11th (local time), U.S. President Donald Trump told reporters at the Kennedy Center in Washington, D.C., “I am willing to extend the negotiation deadline with our trade partners, but I don’t think it’s necessary.” He continued, “We are currently negotiating with a number of countries, and they all want to make deals with the United States,” emphasizing, “We are doing extremely well right now.”

President Trump officially announced his plan to impose mutual tariffs on U.S. trading partners on April 2. A week later, on April 9, the administration declared a 90-day grace period, lasting until July 8, during which individual negotiations with each country have been underway.

When asked which country—following the U.K. and China—might be next to reach a trade agreement, Trump responded, “We are currently in talks with about 15 countries, including Japan and South Korea,” but noted, “While the U.S. has trade relationships with over 150 countries, we can’t negotiate with all of them.”

The Trump administration concluded negotiations with the United Kingdom first on May 8, and is conducting separate talks with China, under a grace period set to expire on August 12. According to Bloomberg, Trump’s remarks signal a clear intent to accelerate trade deal finalizations as the grace period nears its end.

Trump also indicated that the moment for trading partners to decide whether to accept U.S. terms is fast approaching. “At a certain point,” he said, “we will send a formal letter to each country with our final proposal and ask them to decide whether to accept it.” While that moment has not yet arrived, he suggested the letters would be sent within 10 to 14 days. This is being interpreted as a final ultimatum for countries where negotiations have stalled, signaling that the U.S. expects concrete responses imminently.

Trump Hints at Additional Tariffs on Imported Cars

With U.S. President Donald Trump effectively issuing a deadline for trade negotiations, South Korea, where talks have been delayed due to a new administration, now faces mounting pressure amid Washington’s fast-paced demands. The mutual tariff rate for South Korea stands at 25%, and if no agreement is reached before the grace period ends, tariff imposition will be unavoidable.

Back in April, following a call with then-Acting Prime Minister Han Duck-soo, Trump wrote on Truth Social about a “one-stop shopping” approach—a comprehensive deal combining trade negotiations with other issues such as defense cost-sharing. In response, the Korean government is working to finalize a “July package” to reach a bundled agreement, but delays in forming a high-level negotiating team may prove a significant obstacle.

Amid growing concerns over tariff talks, President Trump on the 12th further hinted at the possibility of raising tariffs on imported vehicles. Speaking at a White House bill signing ceremony, he stated, “Previously, to protect American workers, we imposed a 25% tariff on all foreign-made vehicles. Soon, we may increase that tariff further.” The Trump administration has applied a 25% tariff on all foreign-made vehicles entering the U.S. since April 3. Analysts view this as a pressure tactic aimed at forcing global automakers to expand their manufacturing presence in the U.S.

South Korea’s auto industry has already suffered from the 25% tariff, losing export competitiveness in the U.S. market. In April 2025, South Korea’s auto exports to the U.S. totaled USD 2.89 billion, a 20% decline compared to the same month the previous year. The U.S. remains a key export market for South Korea, accounting for nearly 50% of total automobile exports by value. According to the Bank of Korea, if current U.S. tariff policies persist, South Korea’s car exports to the U.S. could decline by 4% annually. Market experts estimate that an additional 10% tariff would slash Hyundai Motor Group’s operating profit by over USD 2.9 billion.

50% Tariffs Also Imposed on Home Appliances Like Washers and Refrigerators

Meanwhile, on the 12th, the U.S. Department of Commerce released an updated list of “steel derivative products” subject to tariffs in the Federal Register. Newly added items include refrigerators, dryers, washing machines, dishwashers, freezers, cooking stoves, ranges, ovens, and garbage disposals.

Previously, in March, the Trump administration imposed a 25% tariff on steel imports, extending that rate to steel-based derivative products based on their steel content value. As of April 4, tariffs on steel and its derivatives were raised to 50%.

The new products announced will be subject to steel tariffs starting on the 23rd. Prior to the announcement, the Department of Commerce had opened a submission process for additional product designations last month. U.S. steelmakers reportedly requested tariff protections for a wide array of items—including boilers, air conditioners, industrial robots, farming equipment, ships, furniture, and dumbbells—virtually all products containing steel. However, whether tariffs will actually be imposed on those broader categories remains uncertain.

With the U.S. increasing both tariff rates and the scope of covered goods—including electronics, machinery, auto parts, and household appliances—Korean companies are facing growing pressure. Samsung Electronics, though operating a plant in South Carolina, still exports a significant volume of its products from Mexico and South Korea, making it difficult to avoid tariff impacts. LG Electronics, which has the capacity to shift up to 20% of its U.S.-bound sales to local production, is planning a gradual transfer of its washer and dryer output to its Tennessee plant, in an effort to increase local manufacturing and mitigate tariff exposure.

Global Tech Giants Like Intel and Micron Shift Toward Southeast Asia
Vietnam Rises Following Malaysia and Singapore
Supply Chain Realignment Around Southeast Asia Gains Traction

Amid shrinking capital expenditures by semiconductor companies due to rising uncertainties such as tariffs following the return of U.S. President Donald Trump to power, Southeast Asian nations like Malaysia, Singapore, and Vietnam are emerging as new hubs for semiconductor production. Given that it typically takes three to four years for a semiconductor fabrication plant to become fully operational after an investment decision is made, it is expected that the global semiconductor supply chain will be realigned around Southeast Asia after the end of President Trump’s current term.

Low Labor Costs and Government-Led Incentives Fuel Southeast Asia’s Rise

On the 13th, the global semiconductor industry association SEMI (Semiconductor Equipment and Materials International) released a report highlighting Southeast Asia’s growing importance in the global semiconductor supply chain. SEMI noted, “Countries like Malaysia, Singapore, and Vietnam are rapidly gaining prominence, particularly in the Assembly, Test, and Packaging (ATP) sector.” It added, “These nations are leveraging their proximity to leading East Asian markets such as Taiwan and South Korea, along with advantages like low labor costs, government-driven investment strategies, tax incentives, and overall lower production costs to compete aggressively for semiconductor investments.”

Malaysia, already home to major players like Intel, Broadcom, and Micron, now accounts for 13% of global semiconductor back-end processing and is emerging as one of Asia’s key supply chain hubs. The Malaysian government has set an ambitious goal of attracting over USD 100 billion in semiconductor-related investment by the end of this year. Intel, which has long operated packaging and assembly lines in Malaysia, is now expanding with the construction of an advanced packaging facility. Micron has also opened its second assembly and testing plant in Penang, while ARM, recently announcing its entry into direct chip manufacturing, has selected Malaysia as the site of its first production facility.

Singapore, meanwhile, accounts for 20% of global semiconductor equipment production, and the semiconductor sector represents roughly 6% of its GDP. Micron is currently upgrading its facilities in Singapore to produce next-generation high-bandwidth memory (HBM), and GlobalFoundries is also expanding its production lines there. In June of last year, Vanguard International Semiconductor (VIS), a subsidiary of TSMC, and NXP announced a joint venture to invest USD 7.8 billion in a new semiconductor wafer fabrication plant in Singapore. The Singaporean government has also pledged USD 13.6 billion in support of R&D and workforce development for the semiconductor industry.

Vietnam Offers to Cover Up to 50% of Initial Investment Costs

Following in the footsteps of Malaysia and Singapore, longstanding semiconductor hubs in Southeast Asia since the 1970s, Vietnam is rapidly emerging as a rising power in chip assembly and testing. While it had previously lagged behind neighboring countries due to limited infrastructure, the Vietnamese semiconductor market is now expanding swiftly, driven by robust government support. The market grew by 41%, from USD 10.62 billion in 2016 to USD 15.01 billion in 2023, with the country aiming to reach USD 10 billion in semiconductor exports this year.

In January, the Vietnamese government took a major step by announcing a decree to cover up to 50% of initial investment costs for semiconductor and AI R&D projects. This proactive policy has begun to attract global tech giants. NVIDIA CEO Jensen Huang, who visited Vietnam late last year, pledged to establish an AI R&D center in the country and announced additional investment beyond the previously committed USD 250 million. NVIDIA also formalized plans to acquire VinBrain, an AI startup under Vietnam’s largest conglomerate, Vingroup.

Apple is also deepening its investment. During his visit in April last year, CEO Tim Cook reached an agreement with Vietnamese officials to expand investment in semiconductor-related facilities. As of late 2023, Apple had committed about USD 17 billion in Vietnam through more than 70 manufacturing partners and 150 suppliers. The company aims to produce 20% of Apple Watches and iPads, 5% of MacBooks, and 65% of AirPods in Vietnam by the end of this year.

Google established a Vietnamese subsidiary in 2023 and is pursuing investments in data centers and cloud infrastructure. Other global chip companies—including Ampere Computing, Marvell, Cirrus Logic, Infineon, and Skyworks—are also reportedly exploring investment opportunities in Vietnam.

Toward Full-Spectrum Semiconductor Production

Vietnam has also unveiled a long-term national strategy to position itself as a global semiconductor hub. In September 2023, Prime Minister Pham Minh Chinh announced the “Vietnam Semiconductor Industry Development Strategy and Vision” (Decision No. 1018/QĐ-TTg), outlining both short- and long-term roadmaps through 2030 and 2050.

The three-phase plan includes key infrastructure development and talent training goals across chip design, manufacturing, packaging, and testing:

Phase 1 (2024–2030): Actively attract foreign direct investment (FDI) to establish at least 100 design companies, one small-scale chip fab, and 10 packaging and testing plants. It targets USD 25 billion in annual industry revenue, 10–15% value-added contribution, and 5 million electronics industry jobs, while training over 50,000 engineers and graduates to become a global semiconductor talent hub.

Phase 2 (2030–2040): Focuses on elevating Vietnam into a global semiconductor center, with goals of USD 50 billion in annual revenue and 15–20% value-added share, emphasizing advanced manufacturing and strengthening the entire value chain.

Phase 3 (2040–2050): Aims for USD 100 billion in annual revenue, 20% value-added share, and the establishment of at least three fabs and 20 packaging/testing facilities, securing Vietnam’s place in the global supply chain.

Aligning with this national strategy, Vietnam has begun constructing the region’s first full-spectrum semiconductor manufacturing facility. According to local reports from March, the Ministry of Information and Communications approved a wafer processing plant project valued at USD 500 million.

The facility will span the entire semiconductor value chain—from research and design to manufacturing, packaging, and testing—making it a comprehensive production site. The Vietnamese government plans to offer tax incentives and provide direct support of up to 30% of the total investment, reinforcing its commitment to transforming the nation into a leading chip-making hub in Southeast Asia.

Israel Launches ‘Operation Waking Lion’
Stalled U.S.–Iran Nuclear Talks Trigger Airstrikes
Expert: “A Full-Scale War Between the Two Countries Is Now a Real Possibility”

Israel has carried out a large-scale preemptive strike against Iran, marking a significant military escalation. The airstrikes come amid the near-collapse of nuclear negotiations between the United States and Iran, with Israel opting to directly target Iran’s nuclear facilities. Experts warn that the severity of this attack is substantial and suggest that a retaliatory strike from Iran could serve as the tipping point for a full-scale war between the two nations.

Operation "Rising Lion" Targets Nuclear and Military Sites

On the 13th (local time), Israel confirmed that it had launched a large-scale preemptive strike on Iran, deploying dozens of fighter jets to target several nuclear and military facilities. Israeli Prime Minister Benjamin Netanyahu declared, “We have launched Operation Rising Lion to repel Iran, which poses a threat to Israel’s survival,” adding that the airstrike struck the heart of Iran’s uranium enrichment infrastructure. He also stated that the targets included Iranian military commanders and missile program sites.

The Israel Defense Forces (IDF) acknowledged the preemptive attack, stating that they had completed the first phase of military strikes against Iran’s nuclear program. According to Iranian state media and Reuters, the airstrikes resulted in the deaths of IRGC commander Hossein Salami and two Iranian nuclear scientists.

In anticipation of retaliation, the Israeli government immediately closed its airspace and went on high alert. Tens of thousands of Israeli troops were mobilized, and the military announced a suspension of schools, public gatherings, and all non-essential activities. Israeli Defense Minister Israel Katz declared a state of emergency, warning that Iran could soon launch retaliatory drone and missile attacks.

Netanyahu: "We Will Not Be Victims of a Nuclear Holocaust"

The launch of Operation Rising Lion is rooted in Israel’s long-standing concern over Iran’s nuclear ambitions. After the strikes, Prime Minister Netanyahu claimed that Iran had already produced enough highly enriched uranium for nine nuclear bombs and could achieve weaponization within a matter of months. “This poses a clear and immediate threat to Israel’s survival,” he warned. Referencing history, he added, “Eighty years ago, Jews were victims of the Holocaust under the Nazi regime. Today, the Jewish state of Israel refuses to become the victim of a nuclear holocaust brought on by the Iranian regime.”

Israel’s decision to resort to military action comes after months of stalled nuclear negotiations between the U.S. and Iran. The Trump administration had initiated indirect talks with Tehran in April, holding five rounds of negotiations, but no significant progress was made. The core issue remains the disagreement over Iran’s right to enrich uranium. The U.S. insists on a ban, while Iran has firmly rejected any complete prohibition.

Even before the strike, international media had anticipated a possible Israeli attack. On the 12th, The Wall Street Journal (WSJ) cited multiple U.S. and Israeli government officials who said that if the nuclear talks failed, Israel could launch an attack on Iran within days. One senior Israeli official told WSJ, “If Iran does not halt its production of fissile material that could be used for nuclear weapons, another strike could occur as soon as the 15th.” That date coincides with the scheduled sixth round of indirect nuclear talks between the U.S. and Iran.

On the same day, President Donald Trump also acknowledged the rising risk of full-scale conflict in the Middle East. Speaking at a press conference at the White House, he remarked, “An Israeli attack on Iran is a real possibility. I don’t want to say it’s imminent, but it’s certainly something that could happen.” He added, “We’re still in a phase where diplomatic progress is possible. While an attack might undermine diplomatic efforts, it could also strengthen them in some ways.”

Israel Crosses Iran’s ‘Red Line’

Experts are warning that Israel’s latest strike could serve as a catalyst for an all-out war between the two countries. One diplomatic analyst noted, “This is the third time since October of last year that Israel has launched an attack on Iranian territory. Given the scale and severity of this most recent strike, the likelihood of escalation is much higher.”

On October 1 last year, Iran launched a large-scale missile attack on Israel, firing more than 180 missiles. At the time, Iran stated the strike was in retaliation for the death of a Hamas political leader in July, which occurred within Iranian territory. Most of the missiles were intercepted by Israel and its allies, with only a few reaching central and southern Israel.

Later that month, on October 26, Israel carried out a retaliatory strike on Iran, targeting air defense systems, missile production facilities, and other military infrastructure. Iranian authorities confirmed that various sites in Tehran, Khuzestan, and Ilam provinces were hit. However, they claimed that most of the Israeli attacks were successfully thwarted, and that only “limited damage” had occurred in some areas. Despite the exchange of military strikes, the overall damage remained relatively minimal.

This time, however, the situation appears far more serious. Israel directly targeted Iran’s nuclear facilities—a line Tehran has long declared as a clear red line, one that would provoke inevitable consequences if crossed. In response, the Iranian government swiftly issued a nationwide air defense alert and warned that it would firmly retaliate against Israel’s provocation.

Analysts suggest that Iran’s retaliation may not be limited to its own forces. There are growing concerns that Iran's regional allies—such as Hezbollah in Lebanon, the Houthi rebels in Yemen, and Shiite militias in Iraq—may join in, potentially triggering a broader regional conflict.

Trump Again Urges Interest Rate Cuts in White House Speech
“I won’t fire Powell, but I may need to pressure him somehow”
Academics Warn: “If Central Banks Yield to Populism, Inflation Will Surge”

In a dramatic and politically charged confrontation with the U.S. central bank, President Donald Trump has reignited his campaign to force the Federal Reserve toward aggressive interest rate cuts—this time with sharper rhetoric, deeper implications, and a rapidly growing list of economic consequences. The president’s increasingly personal attacks on Fed Chairman Jerome Powell and his public campaign to undermine the central bank’s autonomy are not only shaking investor confidence but also triggering fears of a looming crisis in global trust in the U.S. dollar.

Trump’s remarks come at a time when key inflation indicators are signaling a slowdown, strengthening his argument for monetary easing. Yet critics warn that his approach—defined by public insults, political pressure, and the apparent orchestration of a “shadow Fed chair”—may backfire. Not only could it destabilize central bank governance, but it may also open the door to long-term inflationary pressures and a sharp depreciation of the dollar that could reverberate across global markets.

Mounting Pressure and Public Rebuke

On June 12, speaking from the White House, Trump asserted that lowering interest rates by two percentage points could save the United States as much as USD 600 billion annually. But rather than delivering a technical critique of Federal Reserve policy, the president launched into a blistering personal attack on Jerome Powell, branding him a “numbskull” and accusing him of stalling economic progress. According to Trump, Powell's refusal to lower rates is the single obstacle preventing massive savings for the American economy. The president derisively described Powell as someone who sits idly and claims he “can’t find enough reason to cut rates.”

While Trump maintained that he would not dismiss Powell, he ominously suggested he “might need to pressure him to do something,” fueling speculation that the administration is actively seeking ways to sideline or discredit the Fed chair. Analysts believe this is part of a broader effort to induce Powell’s early resignation, even though his term extends through May of next year. Some interpret this maneuver as laying the groundwork for a "shadow Fed chair"—a figure unofficially empowered to shape market expectations while formal authority remains with Powell.

Commerce Secretary Howard Lutnick quickly echoed Trump’s criticism, claiming that the country could realize substantial savings if Powell would simply lower rates. In a Fox News interview, Lutnick said the economy was primed for action, inflation was low, and it was time for Powell to fulfill his responsibilities.

These remarks followed the release of economic indicators that appeared to support Trump’s narrative. In May, the U.S. Producer Price Index (PPI) rose just 0.1% from the previous month—below the 0.2% forecast by economists. Core PPI, excluding food and energy, also climbed only 0.1%, missing expectations of 0.3%. The Consumer Price Index (CPI) followed suit, registering a 0.1% increase, well under the projected 0.2%. Core CPI was similarly subdued at 0.1%, undershooting the anticipated 0.3%. For the administration, these numbers were presented as evidence that inflationary pressure remained tame, and that the Fed was overly cautious, even in the face of a weakening price environment.

The Risk of Undermining Central Bank Autonomy

While Trump has never been shy about expressing his frustration with the Federal Reserve, his latest comments suggest a deepening political offensive against its leadership. On June 11, just a day before the public outburst, Trump had already called for a full one-percentage-point cut in interest rates. Vice President J.D. Vance added to the chorus, declaring that the Fed’s failure to act amounted to a dereliction of monetary policy duty.

This direct political intrusion into central bank decisions has sparked alarm across the economic and academic community. Economists argue that central banks must operate independently of short-term political considerations in order to maintain credibility and effectively manage inflation. Among them is former Reserve Bank of India Governor and prominent economist Raghuram Rajan, now a professor at the University of Chicago Booth School of Business. Rajan explained that while political leaders like Trump may seek interest rate cuts to stimulate short-term growth, central banks have a fundamentally different mandate: long-term price stability.

Rajan emphasized that when governments interfere in monetary policy, the outcome is often rising inflation that harms the very consumers such policies claim to protect. He noted that although U.S. inflation had fallen to 2.4% in May—just above the Fed’s 2% target—the threat of rising prices remains, especially with the administration’s tariff-heavy trade policies still in place. According to Rajan, resisting political pressure is not a luxury but a necessity: only by maintaining its autonomy can the central bank take the sometimes painful but necessary steps to manage inflation expectations and ensure economic stability.

Some economic analysts have pointed to Turkey as a cautionary tale. In 2021, President Recep Tayyip Erdoğan dismissed the country’s central bank chief just four months into his tenure for raising interest rates. The move, widely seen as a political overreach, shattered the bank’s credibility and investor trust. What followed was an economic spiral: Turkey’s inflation soared uncontrollably, reaching 85.5% by October 2022. For critics of Trump’s approach, Turkey’s example is a chilling reminder of the dangers of subordinating monetary policy to populist demands.

Dollar in Decline as Markets Brace for More Volatility

While the domestic debate continues, international markets are already reacting to the consequences of Trump’s Fed offensive. The president’s combination of political interference and unpredictable tariff policies has begun to erode confidence in the U.S. dollar—a currency long regarded as a global safe haven.

On June 11, legendary hedge fund investor Paul Tudor Jones predicted in a Bloomberg TV interview that the dollar could fall as much as 10% over the next year. He attributed this expected drop to the sharp decline anticipated in short-term interest rates, arguing that everyone understands such cuts are likely. According to Jones, once those cuts occur, the steepening yield curve will reduce the appeal of holding dollar-denominated assets, leading to significant downward pressure on the currency’s value.

These warnings are already bearing out in the data. The Bloomberg Dollar Index has fallen roughly 8% since the beginning of the year—its steepest drop since the index was launched in 2005. Analysts point to Trump’s policy volatility and attacks on Fed independence as major contributing factors. Bloomberg has reported that investors in the options market are increasingly preparing for prolonged dollar weakness. Although sentiment has improved since the darkest days of the COVID-19 pandemic, most investors still expect the dollar to lose value against a basket of major currencies in the coming month.

With each new outburst and every fresh wave of political pressure, Trump’s campaign against the Fed appears to be reverberating far beyond Washington. What began as a battle over interest rates has evolved into a broader confrontation over the independence of America’s most powerful economic institution—and the stability of the global financial system that depends on it.

Israel Launches Pre-Dawn Airstrikes, Targets Dozens of Nuclear and Military Facilities
Prime Minister Netanyahu: 'Operations Will Continue Until the Iranian Threat Is Eliminated'
Iran Vows Large-Scale Retaliation, Signs of Escalation Toward Full-Scale War

Tensions in the Middle East have erupted into a dramatic escalation after Israel launched a surprise airstrike on Iran’s nuclear and military facilities. What was initially framed by Israel as a preemptive defense measure has swiftly triggered a retaliatory response from Tehran, setting in motion a chain of events that analysts fear could ignite a full-blown regional war. As both sides exchange attacks and threats, the ripple effects are being felt globally—nowhere more visibly than in the energy markets. Crude oil prices have skyrocketed, with fears that a blockade of the Strait of Hormuz or broader military conflict could send prices to unprecedented highs.

Crude Oil Could Hit USD 130 Per Barrel

The financial impact of the conflict was immediate and severe. According to Investing.com, futures for West Texas Intermediate (WTI) crude oil, set for July delivery, surged 8% to USD 73 per barrel by 1 a.m. U.S. Eastern Time on June 13. At its intraday peak, WTI soared nearly 10%, briefly exceeding USD 74 per barrel—the highest in five months. Brent crude, the international benchmark, climbed in tandem to USD 74.60, also reflecting an 8% jump.

These dramatic price spikes are being driven not just by the airstrike itself, but by intensifying fears that the Middle East—responsible for roughly one-third of the world’s oil production—could descend into prolonged warfare. Iran, in particular, is the third-largest producer within the Organization of the Petroleum Exporting Countries (OPEC). Any disruptions in its output, or attacks on regional transport infrastructure, would jolt the already fragile global oil supply chain.

The most immediate threat lies in the potential closure of the Strait of Hormuz. This narrow chokepoint is responsible for transporting around 20% of global oil shipments, one-third of liquefied natural gas (LNG) exports, and one-sixth of the world’s crude supply. Iran has previously warned that it considers the Strait a strategic lever and could blockade or target tankers transiting through it. South Korea and many other energy-importing nations are especially dependent on this route.

Alarmed by these prospects, global investment bank JPMorgan has reiterated its earlier warning: if the Strait of Hormuz were to be shut down or if military clashes engulf the wider Middle East, crude prices could soar beyond USD 130 per barrel—triggering knock-on effects for inflation, transportation costs, and energy-dependent industries around the world.

Israel’s Preemptive Strike and Iran’s Escalating Retaliation

On June 12, Israel shocked the region by launching a coordinated preemptive airstrike on strategic sites across Iran, including nuclear infrastructure. Israeli Defense Minister Israel Katz declared the strike a necessary preemptive action to neutralize what he described as an imminent threat from Iran. A state of special emergency was also declared. Residents near Tehran reported hearing multiple massive explosions, confirming the scale of the Israeli assault.

The operation, named “Nation of Lions,” aimed squarely at dismantling Iran’s ability to produce nuclear weapons and degrade its missile capabilities. According to Israeli officials, the airstrikes killed several senior figures within the Islamic Revolutionary Guard Corps (IRGC), including Commander-in-Chief Hossein Salami. Additionally, key Iranian nuclear scientists—Mohammad Tehranchi and Fereydoon Abbasi—were also killed. The symbolic and strategic nature of these targets has fueled fears that the attack crossed one of Iran’s most well-publicized red lines.

Israeli Prime Minister Benjamin Netanyahu, in a video address released on the day of the strike, stated the operation’s objective clearly: to destroy Iran’s nuclear infrastructure, missile production sites, and military strength. He further warned that the campaign would continue “for as long as necessary” and justified the preemptive strike by claiming Iran was mere days away from producing up to 15 nuclear bombs. He described this as a direct threat to both Israeli and global security.

According to reports from The Wall Street Journal, Netanyahu had spoken with U.S. President Donald Trump on June 9 to inform him of Israel’s intention to carry out the strike. U.S. officials later confirmed that Israel had shared operational details in advance, signaling close coordination with Washington.

In retaliation, Iran acted swiftly. By early June 13, the Iranian military had launched more than 100 drones toward Israeli targets. A spokesperson for the Israel Defense Forces (IDF) confirmed the drone barrage and responded by stating that over 200 Israeli fighter jets had launched counterstrikes, hitting more than 100 strategic locations across Iran and deploying over 330 munitions.

Iranian Leaders Vow Harsh Punishment as Missile Forces Mobilize

The response from Iran’s top leadership was immediate and unequivocal. In a fiery statement carried by the state-run IRNA news agency, Supreme Leader Ayatollah Ali Khamenei condemned Israel’s attack, describing it as the regime’s most “vicious” act to date. He accused Israel of extending its “filthy and bloodstained hands” to strike Iranian residential areas and warned that Israel had “prepared a bitter and painful fate” for itself. “The strong hand of the Iranian military,” he declared, “will not let this crime go unpunished.”

Khamenei also honored the deaths of IRGC leaders and nuclear scientists as acts of martyrdom, affirming that their successors would continue their mission in accordance with divine will. His words served both as a warning to Israel and a rallying cry to Iran’s military and the broader population.

Iran’s military posture appears to support those words. According to a 2025 report from the International Institute for Strategic Studies (IISS), the IRGC controls over 100 launchers for medium-range ballistic missiles (MRBMs), with ranges exceeding 1,000 kilometers. The country has a vast arsenal of solid- and liquid-fueled missiles, many of which are capable of reaching Israeli territory.

However, Iran’s air force is a known weak point. The nation possesses about 265 combat-capable aircraft, most of which date back to the Cold War and are considered obsolete. These jets would require aerial refueling to reach Israeli targets—a capability Iran can only support with its limited fleet of fewer than five aerial refueling tankers.

Despite these limitations, Iran’s missile forces remain a serious threat. Former U.S. national security official Brett McGurk noted that the Iranian military is capable of launching approximately 30 ballistic missiles every five minutes, with a flight time of just 13 minutes to reach Israel. Such capabilities make any sustained conflict between the two nations potentially devastating, not only for them, but for the entire region and the global economy.

Boeing 787-8 Dreamliner Explodes After Plunging One Minute Post-Takeoff
Ongoing Safety Controversies Over the Years Erode Market Trust
New CEO’s Efforts to Rebuild Image Go Up in Smoke

Boeing, the world-renowned American aircraft manufacturer, is once again in crisis. The company finds itself at the center of another aviation tragedy—this time involving one of its most advanced aircraft models. An Air India flight, operated using a Boeing 787-8 Dreamliner, crashed shortly after takeoff from Ahmedabad, India, killing 241 of the 242 people on board. This incident, already heartbreaking in its human toll, is reigniting a long-burning debate about the safety and oversight of Boeing’s aircraft. Despite the company’s ongoing efforts to restore public and investor confidence, the crash marks another devastating chapter in a string of fatal accidents that have plagued Boeing in recent years.

India’s Deadliest Crash in Years: A Dreamliner Goes Down

On June 12, at approximately 1:39 PM local time, tragedy struck near the Ahmedabad Airport in Gujarat, India. An Air India Boeing 787-8 Dreamliner, one of Boeing’s most advanced and widely used medium- to long-haul aircraft, crashed less than a minute after takeoff. The jet reportedly entered a sharp descent moments after becoming airborne and collided with a dormitory building of a state-run medical college in the Meghani Nagar district, located just east of the airport. The impact caused a massive explosion, triggering a secondary disaster for those on the ground.

The plane was carrying a total of 242 people—passengers and crew combined. According to reports, the nationalities included 169 Indian citizens, 53 British nationals, 7 Portuguese, and 1 Canadian. Out of everyone on board, only a single survivor has been confirmed. Rescue operations at the crash site revealed further casualties in the dormitory cafeteria, where the aircraft had struck with brutal force. According to Reuters, citing eyewitnesses and rescue teams, at least 30 to 35 bodies have been recovered from the rubble, and many more are feared trapped beneath the wreckage.

What has shocked many aviation analysts is the model involved: the Boeing 787-8 Dreamliner. Since its debut in 2011, the Dreamliner has been celebrated for its fuel efficiency, modern avionics, and composite design. Over 1,175 of the aircraft have been delivered to more than 70 airlines globally. Until now, it had never been involved in a fatal crash. The specific aircraft in this incident first entered service in 2013 and was officially delivered to Air India in January 2014.

This singular event has shattered the Dreamliner’s spotless safety record and raised grave concerns about whether Boeing’s systemic issues extend even to its flagship models.

Boeing’s Grim Track Record: From MCAS Failures to Structural Failings

While the Dreamliner had previously been considered a symbol of Boeing’s engineering excellence, the broader history of Boeing aircraft over the past decade tells a different story—one defined by recurring failures, defective systems, and mounting death tolls.

The most high-profile among these was the Lion Air crash in October 2018, in which a Boeing 737 Max 8 plunged into the sea just 13 minutes after takeoff from Jakarta, killing all 189 people on board. Merely five months later, another 737 Max 8 operated by Ethiopian Airlines crashed shortly after departing Addis Ababa, claiming 157 more lives. Investigators later discovered a fatal flaw in the Maneuvering Characteristics Augmentation System (MCAS)—a flight stabilization system meant to prevent stalls. The software repeatedly forced the aircraft’s nose down due to erroneous sensor readings, overpowering the pilots’ efforts to regain control.

The fallout from those accidents led to a global grounding of the 737 Max fleet and exposed serious lapses in Boeing’s internal safety culture and regulatory oversight. The issue wasn’t just the MCAS itself—it was how Boeing had minimized its significance in pilot training manuals. It allegedly misled the FAA during certification, but the problems didn’t end there.

In January 2024, an Alaska Airlines 737 Max 9 suffered a terrifying structural failure mid-flight. A window and part of the fuselage detached at an altitude of about 5,000 meters just after takeoff from Portland International Airport. While miraculously no one was injured, the incident caused severe reputational damage to Boeing and was a tipping point that led to the resignation of then-CEO Dave Calhoun. His role was taken over by Robert Kelly Ottburg, an engineer by background, tasked with repairing Boeing’s credibility.

Older Boeing models haven’t fared any better. In January 2021, a 737-500 departing Jakarta crashed into the sea, killing 62 people. In March 2022, a 737-800 went down in Wuzhou, China, claiming 132 lives. And in December 2024, a Jeju Air 737-800 crashed, killing 179 passengers—another devastating blow tied to the same 737 family. What was once considered Boeing’s most trusted aircraft line has now become synonymous with tragedy and systemic failure.

Confidence Falters Again Despite Recovery Efforts

In recent months, Boeing has made visible strides toward recovering its public image and financial standing. Under Ottburg’s leadership, the company focused on stabilizing production lines and securing large-scale orders to shore up confidence. In November 2024, Boeing concluded its first major labor strike in 16 years. By May 2025, it had reached a settlement with the U.S. Department of Justice to avoid criminal prosecution related to the 2018 Lion Air disaster—terms included significant compliance commitments and financial penalties.

These initiatives began to bear fruit: over a three-month stretch, Boeing’s stock surged nearly 45%, signaling a tentative return of investor faith. But that progress has now hit a wall.

Following the Air India crash, Boeing released a statement from Ottburg, stating that the company is “fully prepared to cooperate with the investigation led by India’s Aircraft Accident Investigation Bureau (AAIB).” The CEO reportedly spoke directly with the chairman of Air India, pledging Boeing’s “complete support” and vowing to defer entirely to Indian authorities regarding the findings and public communication. It was a strategic move to show responsibility and transparency—something the company had been previously criticized for lacking.

Still, the market’s response was swift and unforgiving. On June 12, the same day as the crash, Boeing shares dropped 4.79%, closing at USD 203.75 on the New York Stock Exchange. Shares of key suppliers like GE Aerospace and Spirit AeroSystems also took a hit, each declining more than 2%.

The crash has reignited long-standing skepticism among investors and regulators alike. Despite Boeing’s public relations push, the grim reality remains: faith in the company’s quality control, safety protocols, and corporate integrity is eroding—and now with the loss of 241 more lives, the cost is as stark as ever.