Finance

China’s Xiaomi is taking aim at Tesla’s bestselling car in China with the YU7 SUV due for launch this summer.
“We expect Yu7 would significantly erode Tesla Model-Y’s China market share,” Citi analyst Jeff Chung said in a report Sunday.
The YU7 is positioned as a “luxury SUV” and its sales could outperform that of Xiaomi’s SU7, research firm CLSA’s Elinor Leung said.

Xiaomi revealed its first electric SUV, the YU7, in Beijing on May 22, 2025, and said its full launch would be held in July.
Adek Berry | Afp | Getty Images

BEIJING — China’s Xiaomi, known for its smartphones, only recently entered the electric-vehicle space. It is now taking aim at Tesla’s bestselling car in China.
Less than a year after launching its first electric car, Xiaomi late on Thursday revealed its YU7 SUV and claimed it would have a driving range of at least 760 kilometers (472 miles) on a single charge.

That’s well above the 719 km advertised for Tesla’s extended-range Model Y. Driving range has been a selling point for consumers worried about frequent battery charging.
“We expect Yu7 would significantly erode Tesla Model-Y’s China market share,” Citi analyst Jeff Chung said in a report Sunday.
Citi expects the YU7 to be priced around 250,000 yuan to 320,000 yuan ($34,700 to $44,420), and forecasts monthly sales of about 30,000 units. Once sales pick up, Citi predicts annual sales of 300,000 to 360,000 units.
That price range pits the YU7 against Tesla’s Model Y, which starts at 263,500 yuan in China. Xiaomi plans to announce the YU7’s price at the car’s official launch in July.

Xiaomi plans to announce the YU7’s price at the car’s official launch in July.

Tesla’s Model Y was the second most sold new energy vehicle in China in the six months through April, according to Autohome, an online platform for consumer information on cars in China. BYD’s far cheaper Seagull ranked first, while the budget Wuling Hongguang Mini ranked third.
For April alone, Geely’s Geome Xingyuan topped the new energy vehicle bestsellers’ list, followed by BYD’s Seagull and the Wuling Hongguan Mini, Autohome data showed. Xiaomi’s SU7 sedan ranked fourth, followed by three BYD models, while Tesla’s Model Y ranked eighth.

Better than Xiaomi’s first car?

The YU7 is positioned as a “luxury SUV” and its sales could outperform that of the SU7, Elinor Leung, managing director of Asia telecom and internet research at CLSA, said in a note.
Last year, Xiaomi released its first electric car, the SU7 sedan, priced $4,000 lower than Tesla’s Model 3 at the time. Tesla subsequently reduced Model 3 price to 235,500 yuan as of May 26 — although it is still more expensive than the SU7 sedan at 215,900 yuan.
Xiaomi delivered more than 28,000 units of its SU7 car in April, down from its record of more than 29,000 during the previous month. That comes after the crash of an SU7 vehicle in China that left three people dead. China has since mandated automakers to be careful with the language when advertising driver-assist systems.
Xiaomi revealed the YU7 on Thursday at the end of a launch event for a premium phone using a new chip that the company claimed beat Apple’s on certain metrics. CNBC was not able to independently verify the claims.
Rival electric car company Xpeng is due Wednesday to release the Max version of its relatively popular Mona M03 car. The Max version includes more advanced driver-assist capabilities. The company previously said the Max would begin deliveries after the Lunar New Year holiday in February.

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Round numbers should not matter in financial markets, but they do. How many people pay attention to where 11-year Treasury bonds are trading? So seeing yields on America’s 30-year government debt stuck above 5% since May 21st has given investors the shivers. The latest jump came shortly before the House of Representatives passed President Donald Trump’s “big, beautiful”—and deficit-widening—budget bill by one vote on May 22nd. More

The truce did not last long. On May 23rd President Donald Trump threatened to impose a tariff of 50% on imports from the European Union, more than double the size of his earlier threat of 20%. “Our discussions with them are going nowhere,” he said. The bloc is “very difficult to deal with”. Without progress, the levy will come into effect on June 1st. More

Chicago Fed President Austan Goolsbee said Friday that President Donald Trump’s latest tariff moves have complicated policy and likely put off changes to interest rates.
“Everything’s always on the table. But I feel like the bar for me is a little higher for action in any direction while we’re waiting to get some clarity,” Goolsbee said on CNBC’s “Squawk Box.”

Chicago Federal Reserve President Austan Goolsbee said Friday that President Donald Trump’s latest tariff threats have complicated policy and likely put off changes to interest rates.
In a CNBC interview, the central bank official indicated that while he still sees the direction of rates being lower, the Fed likely will be on hold as it evaluates the ever-changing trade policy and how it affects inflation and employment.

“Everything’s always on the table. But I feel like the bar for me is a little higher for action in any direction while we’re waiting to get some clarity,” Goolsbee said on “Squawk Box” when asked about Trump’s new actions Friday morning. “Over the longer run, if they’re putting in place tariffs that have a stagflationary impact … then that’s the central bank’s worst situation.”
“So I think we’ll have to see how big the impacts on prices are,” he added. “I know people hate inflation.”
Goolsbee spoke as Trump jolted markets again with a call for 50% tariffs on products from the European Union starting June 1, while indicating Apple will have to pay a 25% tariff on iPhones not made in the U.S. Apple mostly makes its coveted smartphones in China, though there is some production in India as well.
While the impact of a costlier iPhone likely wouldn’t mean much from a larger economic perspective, the saber-rattling underscores the volatility of trade policy and provides another flash point for a market already unnerved by worries about fiscal policy that have sent bond yields sharply higher.
Central bankers are generally careful not to wade into issues of fiscal and trade policy, but are left to analyze their repercussions.

Goolsbee said he is still optimistic that the longer-run trajectory is toward solid economic growth before Trump’s April 2 tariff announcement that rattled markets.
“I’m still underneath hopeful that we can get back to that environment, and 10 to 16 months from now, rates could be a fair bit below where they are today,” he said.
Goolsbee is a voting member this year on the rate-setting Federal Open Market Committee, which next meets June 17-18. At the meeting, officials will get a chance to update their economic and interest rate projections. The last update, in March, saw the committee indicating two rate cuts this year.
Markets expect the Fed will cut twice this year, with the next move not happening until September. Goolsbee did not commit to a course of action from here amid the uncertainty.
“I don’t like even mildly tying our hands at the next meeting, much less over six, eight, 10 meetings from now,” he said. “That said, as we went into April 2, I believe that we’re at pretty stable full employment, that inflation was on a path back to 2% and if we could do those, I thought that over the next 12 to 18 months, rates could come down a fair amount.”
The Fed’s benchmark overnight borrowing rate is targeted between 4.25% and 4.50%, where it has been since December. The actual rate most recently traded at 4.33%.

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The personal finance startup Monarch has raised $75 million to accelerate subscriber growth that took off last year when budgeting tool Mint was shut down, CNBC has learned.
The fundraising is among the largest for an American consumer fintech startup this year and values the San Francisco-based company at $850 million, according to co-founder Val Agostino.
The field was once dominated by Mint, a pioneer in online personal finance that was acquired by Intuit in 2009. After the service languished for years, Intuit closed it in early 2024.

Monarch co-founders (left to right) Ozzie Osman, Jon Sutherland, Val Agostino.
Courtesy: Monarch

The personal finance startup Monarch has raised $75 million to accelerate subscriber growth that took off last year when budgeting tool Mint was shut down, CNBC has learned.
The fundraising is among the largest for an American consumer fintech startup this year and values the San Francisco-based company at $850 million, according to co-founder Val Agostino. The Series B round was led by Forerunner Ventures and FPV Ventures.

Monarch aims to provide an all-in-one mobile app for tracking spending, investments and money goals. The field was once dominated by Mint, a pioneer in online personal finance that Intuit acquired in 2009. After the service languished for years, Intuit closed it in early 2024.
“Managing your money is one of the big unsolved problems in consumer technology,” Agostino said in a recent Zoom interview. “How American families manage their money is still basically the same as it was in the late 90s, except today we do it on our phones instead of walking into a bank.”
Monarch, founded in 2018, saw its subscriber base surge by 20 times in the year after Intuit announced it was closing Mint as users sought alternatives, according to Agostino.
Unlike Mint, which was free, Monarch relies on paying subscribers so that the company doesn’t need to focus on advertising from credit-card issuers or sell users’ data, said Agostino, who was an early product manager at Mint.

Personal finance app Monarch, which has raised a $75 million series B investment.
Courtesy: Monarch

The startup aimed to make onboarding accounts and expense tracking easier than rival tools, some of which are free or embedded within banking apps, according to FPV co-founder Wesley Chan.

Chan said that Monarch reminds him of previous bets that he has made, including his stake in graphic design platform Canva, in that Agostino is tackling a difficult market with a fresh approach.
“What Val is doing, it’s the successor to anything that’s been done in financial planning,” Chan said. “It’s frictionless, it’s easy to use and it’s easy to share, which is something that never existed before. That’s why he’s growing so quickly, and why the engagement numbers are so high.”
The company’s round comes amid a period of muted interest for most U.S. fintechs that cater directly to consumers. Monarch is one of the few firms to raise a sizeable Series B; other recent examples include Felix, a money remittance service for Latino immigrants.
Fintech firms raised $1.9 billion in venture funding in the first quarter, a 38% decline from the fourth quarter that “signals deepening investor caution toward B2C models,” according to a recent PitchBook report. Roughly three-quarters of all the venture capital raised in the quarter went to companies in the enterprise fintech space, PitchBook said.
“The sector is still in nuclear winter” as it faces a hangover from 2021-era startups that “raised way too much money and had zero progress and wrecked it for everybody else,” Chan said. “That’s fine with me, I love nuclear-winter sectors.” More

A tax and spending package passed Thursday by House Republicans funnels the bulk of its financial benefits to wealthy households, according to economists and tax experts.
The rich benefit via a slew of tax cuts tied to businesses, the SALT deduction, the estate tax, income tax rates and opportunity zones.
Lower earners would be worse off, on average, due to cuts to programs like Medicaid and SNAP (formerly known as food stamps), analyses show.

House Speaker Mike Johnson speaks to the media after the House narrowly passed a budget bill forwarding President Donald Trump’s agenda at the U.S. Capitol in Washington, May 22, 2025.
Kevin Dietsch | Getty Images

There’s a stark contrast between high-earners and low-income households in a sprawling legislative package House Republicans passed on Thursday.
The bulk of the financial benefits in the legislation — called the “One Big Beautiful Bill Act” — would flow to the wealthiest Americans, courtesy of tax-cutting measures like those for business owners, investors and homeowners in high-tax areas, experts said.

However, low earners would be worse off, they said. That’s largely because Republicans partially offset those tax cuts — estimated to cost about $4 trillion or more — with reductions to social safety net programs like Medicaid and the Supplemental Nutrition Assistance Program, or SNAP.
The tax and spending package now heads to the Senate, where it may face further changes.

‘It skews pretty heavily toward the wealthy’

The Congressional Budget Office, a nonpartisan federal scorekeeper, estimates income for the bottom tenth of households would fall by 2% in 2027 and by 4% in 2033 as a result of the bill’s changes.
By contrast, those in the top 10% would get an income boost from the legislation: 4% in 2027 and 2% in 2033, CBO found.

A Yale Budget Lab analysis found a similar dynamic.

The bottom fifth of households — who make less than $14,000 a year — would see their annual incomes fall about $800 in 2027, on average, Yale estimates.
The top 20% — who earn over $128,000 a year — would see theirs grow by $9,700, on average. The top 1% would gain $63,000.
The Yale and CBO analyses don’t account for last-minute changes to the House legislation, including stricter work requirements for Medicaid.
“It skews pretty heavily toward the wealthy,” said Ernie Tedeschi, director of economics at the Yale Budget Lab and former chief economist at the White House Council of Economic Advisers during the Biden administration.
The legislation compounds the regressive nature of the Trump administration’s recent tariff policies, economists said.
“If you incorporated the [Trump administration’s] hike in tariffs, this would be even more skewed against lower- and working-class families,” Tedeschi said.

Most bill tax cuts go to top-earning households

There are several reasons the House bill skews toward the wealthiest Americans, experts said.
Among them are more valuable tax breaks tied to business income, state and local taxes and the estate tax, experts said.
These tax breaks disproportionately flow to high earners, experts said. For example, the bottom 80% of earners would see no benefit from the House proposal to raise the SALT cap to $40,000 from the current $10,000, according to the Tax Foundation.
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The bill also preserves a lower top tax rate, at 37%, set by the 2017 Tax Cuts and Jobs Act, which would have expired at the end of the year.
It kept a tax break intact that allows investors to shield their capital gains from tax by funneling money into “opportunity zones.”
Trump’s 2017 tax law created that tax break, aiming to incentivize investment in lower-income areas designated by state governors. Taxpayers with capital gains are “highly concentrated” among the wealthy, according to the Tax Policy Center.
All told, 60% of the bill’s tax cuts would go to the top 20% of households and more than a third would go to those making $460,000 or more, according to the Tax Policy Center.
“The variation among income groups is striking,” the analysis said.

Why many low earners are worse off

That said, more than eight in 10 households overall would get a tax cut in 2026 if the bill is enacted, the Tax Policy Center found.
Lower earners get various tax benefits from a higher standard deduction and temporarily enhanced child tax credit, and tax breaks tied to tip income and car loan interest, for example, experts said.
However, some of those benefits may not be as valuable as at first glance, experts said. For example, roughly one-third of tipped workers don’t pay federal income tax, Tedeschi said. They wouldn’t benefit from the proposed tax break on tips — it’s structured as a tax deduction, which doesn’t benefit households without tax liability, he said.

Meanwhile, lower-income households, which rely more on federal safety net programs, would see cuts to Medicaid, SNAP (formerly known as food stamps), and benefits linked to student loans and Affordable Care Act premiums, said Kent Smetters, an economist and faculty director at the Penn Wharton Budget Model.
The House bill would, for example, impose work requirements for Medicaid and SNAP beneficiaries. Total federal spending on those programs would fall by about $700 billion and $267 billion, respectively, through 2034, according to the Congressional Budget Office analysis.
That said, “if you are low income and don’t get SNAP, Medicaid or ACA premium support, you will be slightly better off,” Smetters said.

Some high earners would pay more in tax

In a sense, it may not be surprising most tax benefits accrue to the wealthy.
The U.S. has among the most progressive tax systems in the developed world, Smetters said.
The top 10% of households pay about 70% of all federal taxes, he said. Such households would get about 65% of the total value of the legislation, according to a Penn Wharton analysis published Monday.

A subset of high earners — 17% of the top 1% of households, who earn at least $1.1 million a year — would actually pay more in tax, according to the Tax Policy Center.
“In part this is due to limits on the ability of some pass-through businesses to fully deduct their state and local taxes and a limit on all deductions for top-bracket households,” wrote Howard Gleckman, senior fellow at the Tax Policy Center. More

Ray Dalio, founder of Bridgewater Associates LP, speaks during the Greenwich Economic Forum in Greenwich, Connecticut, US, on Tuesday, Oct. 3, 2023.
Bloomberg | Bloomberg | Getty Images

Billionaire investor Ray Dalio on Thursday sounded another alarm on soaring U.S. debt and deficits, saying it should make investors fearful of the government bond market.
“I think we should be afraid of the bond market,” Dalio said at an event for the Paley Media Council in New York. “It’s like … I’m a doctor, and I’m looking at the patient, and I’ve said, you’re having this accumulation, and I can tell you that this is very, very serious, and I can’t tell you the exact time. I would say that if we’re really looking over the next three years, to give or take a year or two, that we’re in that type of a critical, critical situation.”

The founder of Bridgewater Associates, one of the world’s largest hedge funds, has warned about the ballooning U.S. deficit for years. Recently, investors have begun demanding lower prices to buy the bonds that cover the government’s massive budget deficits, pushing up yields on the debt. Rising worries about the fiscal situation last week triggered a high-profile credit rating downgrade from Moody’s.
The yield on the 30-year Treasury yield on Thursday traded at levels not seen since 2023, around 5.14%.
Rising financing costs along with continued spending growth and declining tax receipts have combined to send deficits spiraling, pushing the national debt past the $36 trillion mark. In 2024, the government spent more on interest payments than any other outlay other than Social Security, defense and health care.
“We will have a deficit of about 6.5% of GDP — that that is more than the market can bear,” Dalio said.
Dalio said he’s not hopeful politicians would be able to reconcile their differences and lessen the country’s debt load. In a party-line vote early Thursday, House members approved legislation that lowers taxes and adds military spending. The bill — which now goes to the Senate — could increase the U.S. government’s debt by trillions and widen the deficit at a time when fears of a flare-up in inflation due higher tariffs are already weighing on bond prices and boosting yields.
“I’m not optimistic. I have to be realistic,” Dalio said. “I think it’s the essence of the challenge of our country that anything related to bipartisanship and getting over political hurdles … essentially means ‘give me more,’ which leads to these deficits.”

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Optimism on dealmaking appears to be back now that President Donald Trump has suspended his highest tariffs and market jitters take a backseat.
U.S. deal activity plunged by 66% to $9 billion during the first week of April, according to Mergermarket data, after Trump’s “liberation day” tariff announcement.
Activity is rebounding this month and larger deals are taking place.

People walk by the New York Stock Exchange (NYSE) on June 18, 2024 in New York City. 
Spencer Platt | Getty Images

Hopes for an active year of mergers and acquisitions could be back on track after being briefly derailed by the Trump administration’s sweeping tariff policies last month.
Dealmaking in the U.S. was off to a strong start this year before President Donald Trump announced tariff policies that led to extremely volatile market conditions that put a chill on activity. In a pre-tariffs world, dealmakers were encouraged by the Trump administration’s pro-business flavor and deregulatory agenda, as well as previously easing concerns about inflation. Those trends were expected to fuel an even stronger M&A comeback in 2025, after last year’s moderate recovery from a slow 2023.

This year’s appetite for dealmaking came back quickly after Trump suspended his highest tariffs and market jitters took a backseat. If borrowing costs remain in check, many expect activity could be brisk.
“More clarity on trade policy and rebounding equities markets have set the stage for continued M&A, even in sectors hit especially hard by tariffs,” Kevin Ketcham, a mergers and acquisitions analyst at Mergermarket, told CNBC.
The total value of U.S. deals jumped to more than $227 billion in March, which saw 586 deals, before suddenly slowing down in April to roughly 650 deals worth about $134 billion, according to data compiled by Mergermarket.
So far this month, activity is rebounding and the average deal has been larger. More than 300 deals collectively valued at more than $125 billion have been struck this month as of May 20, Mergermarket said.
That’s encouraging. After Trump’s “liberation day” tariff announcement, U.S. deal activity plunged by 66% to $9 billion during the first week of April from the prior week, while global M&A activity dropped by 14% week over week to $37.8 billion, according to the data.

Charles Corpening, chief investment officer of private equity firm West Lane Partners, anticipates M&A activity to pick up after the summer.
“The trade war has indeed caused a slowdown in the anticipated M&A boom earlier this year, particularly in the second quarter,” Corpening said.
Higher bond yields are also hurting activity in the U.S. given that higher rates translate into greater financing costs, which reduces asset prices, he said.
Corpening expects greater interest towards special situations M&A, or deals that involve a motivated seller and tend to be flexible with their structure and terms, as well as smaller transactions, which are easier to finance and generally face less regulatory scrutiny.
“We’re beginning to see signs of recovery and we’re getting some clarity on the types of deals that are likely to get into the pipeline soonest,” Corpening said. “We anticipate that these earlier transactions will lean toward special situations as the better-performing businesses will wait for more market stability in order to maximize sale price.”

Several major deals have been announced in recent months, with large transactions occurring in tech, telecommunications and utilities so far this year.
Some of the biggest include:

According to Ketcham, the Dick’s-Foot Locker deal “likely isn’t an outlier” given that Victoria’s Secret on Tuesday adopted a “poison pill” plan. Such a limited-duration shareholder rights plan suggests the lingerie retailer is concerned about the threat of a potential takeover, he said.
Ketcham added that some consumer companies are adapting to the new macroeconomic environment instead of pausing dealmaking. He cited packaged food giant Kraft Heinz confirmation on Thursday that it has been evaluating potential transactions over the past several months as an example. Kraft Heinz said it would consider selling off some of its slower growing brands or buying a brands in some of its core categories such as sauces and snacks.
This kind of trend would lead to smaller deals, which has already been seen this year. For example, PepsiCo scooped up Poppi, a prebiotic soda brand, for $1.95 billion in March.

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