Economy
Turkish competition body fines tire companies $78.5M
Türkiye’s competition watchdog announced on Tuesday that it fined tire manufacturers and distributors a combined TL 3.63 billion (nearly $78.5 million) for price coordination, anti-competitive dealer restrictions and labor market violations.
Brisa received the highest fine at TL 1.02 billion, followed by Goodyear at TL 672 million and Continental at TL 397 million, the Competition Authority (RK) said.
Violations included coordinated pricing among competitors and the exchange of sensitive labor market information among others, the authority said.
Moreover, the authority noted that according to the obligations under the investigation, price lists sent to dealers need to be watermarked, announcements cannot be shared collectively, and dealers would need to have access to a system/interface with their own user accounts.
“The practice of sending announcements with the above-mentioned characteristics collectively to multiple dealers or all dealers must be discontinued. Instead, such announcements must be made individually through an interface/portal where each dealer can access the information using its own username and password, and where transactions between the producer/supplier undertakings and dealers are carried out. No verbal or written method other than the relevant interface/portal may be used,” the statement read.
The statement also noted that companies must document that they have implemented these regulations within three months.
Separately, an anti-dumping investigation has been launched into imports of passenger car tires from Czechia, South Korea, Serbia, and Slovakia, as well as cord fabric from China and Vietnam used in their production.
According to the communiqué on preventing unfair competition in imports published in the country’s Official Gazette on Tuesday, following an application by Petlas A.Ş. and Kocaeli Lastik Sanayi A.Ş., supported by Sumitomo Rubber Ako Lastik Sanayi AŞ, it was determined that the alleged dumping of passenger car tires from the Czechia, South Korea, Serbia, and Slovakia caused material damage to the economic indicators of the domestic production sector.
The Board for the Evaluation of Unfair Competition in Imports, the primary trade defense authority in Türkiye, thus decided to open an anti-dumping investigation into the import of these products.
The board also evaluated an application by Kordsa Teknik Tekstil A.Ş. and decided to open an anti-dumping investigation into imports of nylon cord fabric from China and polyester cord fabric from China and Vietnam.
Germany on Tuesday formally rejected UniCredit’s offer for Commerzbank shares, citing a low price and concerns about what it called the Italian lender’s aggressive approach.
UniCredit’s initial offer period for Commerzbank shares is winding down, with both banks digging in their heels in the months-long battle for control of one of Germany’s most important lenders.
On Monday, the Italian bank hailed the fact that it had exceeded the 30% threshold it had set for this takeover bid. The Milan-based lender launched its bid, valued at 35 billion euros ($40.6 billion), in early May to gain control of its German rival and cement its status as a European heavyweight.
The German government holds a 12% stake in Commerzbank acquired in the wake of the 2008 global financial crisis and has long objected to UniCredit’s campaign for a tie-up.
“Accepting the offer was already not an option from a financial point of view, as it does not include an appropriate premium on the current share price of Commerzbank’s shares,” the country’s finance agency said on Tuesday.
Despite Berlin’s position, UniCredit could still win control of the German bank, but the government’s stake gives it seats on Commerzbank’s supervisory board, which appoints management and helps oversee its strategy.
Financial Market Stabilization Fund, which manages the government’s holdings, also said that it supported Commerzbank’s independence, and noted that the bank played a critical role in financing medium-sized Mittelstand companies and was an integral player in Frankfurt, the nation’s financial hub.
“Both must continue to be ensured in the future,” it said.
Separately, Frankfurt prosecutors on Tuesday confirmed that they had begun a preliminary investigation into “possible market manipulation” related to the offer, without providing details.
It follows a criminal complaint filed by Commerzbank’s workers’ council that reached prosecutors on Sunday. The employee group had communicated to staff that they would file the complaint against unspecified persons amid questions about UniCredit’s acquisition of Commerzbank shares at a below-market rate.
UniCredit said in a statement that it was aware of the matter and that the prosecutors’ response was “in line with protocol when such complaints are filed.”
In Tuesday’s trading, Commerzbank shares slipped below the price implied by UniCredit’s buyout offer, after trading consistently above that level since the bid was launched and rendering Italian bank’s offer relatively unattractive.
Shares in Commerzbank were trading at 36.53 euros by 0812 GMT, while those of UniCredit were at 76.97 euros. With an exchange ratio of 0.485 new UniCredit shares for each Commerzbank share tendered, the Italian bank’s bid values Commerzbank at 37.33 euros a share.
The offer ends on Tuesday but will extend for a further 15 days from June 20.
If the offer succeeds and is approved by the European Central Bank (ECB), it should mainly allow UniCredit to gradually increase its stake in Commerzbank and merge it with its German subsidiary HypoVereinsbank.
In particular, the Milan-based bank is proposing to cut back Commerzbank’s international network, deemed too complex and inefficient, and refocus the bank on its activities in Germany.
Chancellor Friedrich Merz said in May the bid was destroying “trust” in Germany’s second-largest private bank.
Seeking to fend off the advances, Commerzbank’s CEO Bettina Orlopp unveiled a strategic plan to strengthen profitability through 2030, including job cuts to become leaner and more attractive to shareholders.
UniCredit has meanwhile asserted that by surpassing the 30% threshold of voting rights, it should be allowed to appoint all of the shareholder representatives to the supervisory board, where two representatives of the German state currently sit.
Orlopp has contested that position, pointing to an agreement with Berlin that guarantees Commerzbank the power to propose the state’s representatives to the board.
Germany’s Economy and Energy Minister Katherina Reiche is expected to visit Türkiye later this week for high-level talks on strengthening trade and energy cooperation, according to her ministry on Monday.
“Türkiye is a strategically important partner for Germany,” ministry spokesperson Susanne Ungrad told reporters in Berlin.
“The visit on Thursday and Friday will focus on the German-Turkish economic and energy partnership,” she said.
Reiche is scheduled to attend meetings of the Joint Economic and Trade Commission (JETCO) and the German-Turkish Energy Forum, both long-standing platforms for deepening bilateral ties.
She will also hold direct talks with Turkish ministerial counterparts, accompanied by around 30 business leaders from key economic and energy sectors.
Germany is one of Türkiye’s largest economic partners and remained its top export destination in 2025.
Supported by more than 8,000 companies with German capital that are registered and active in the country, bilateral trade exceeded $52 billion last year.
During German Chancellor Friedrich Merz’s visit to Ankara in October 2025, the two countries announced their joint ambition to increase bilateral trade to over $60 billion in the near future.
Elon Musk’s SpaceX, fresh off its record-breaking IPO, told U.S. securities regulators on Tuesday that it would acquire Anysphere, the firm behind artificial intelligence coding startup Cursor, at a valuation of $60 billion.
In a filing with the Securities and Exchange Commission (SEC), SpaceX said the all-stock deal was expected to close in the third quarter of this year and that Cursor would become a wholly owned subsidiary.
The two companies had announced a partnership in April that included a clause for Cursor to be potentially bought by SpaceX at the $60 billion figure.
Cursor, founded in 2022 and based in San Francisco, specializes in AI for creating software code, particularly for business uses.
Combining Cursor’s software and product expertise with SpaceX’s “Colossus” AI training supercomputer will enable the company “to build the world’s most useful models,” the companies said in April when announcing their partnership.
The acquisition comes after SpaceX on Friday finally went public, raising a record-breaking $86 billion in its IPO.
A two-day surge in the company’s share price saw SpaceX close trading on Monday at a valuation above $2.5 trillion, placing it among the six largest companies in the world, ahead of Broadcom, Saudi Aramco and Tesla and just behind Amazon.
Co-founded in 2002 by Musk, the world’s first trillionaire, SpaceX has since expanded into a major satellite operator and folded in his artificial intelligence company, xAI, which includes the social media platform X, formerly Twitter.
China’s economy displayed increasing unevenness in May, with retail sales declining for the first time in over three years and investment weakening even as industrial production picked up pace.
Tuesday’s official data highlighted a two-speed growth pattern in the world’s second-largest economy, with factories buoyed by surprisingly resilient exports but domestic demand weakening amid a multiyear property market downturn.
Retail sales, a key gauge of consumption, slid 0.6% in May, data from the National Bureau of Statistics (NBS) showed, reversing April’s 0.2% rise and below the estimated 0.0% in a Reuters poll. It was the first monthly fall since December 2022.
The fragility was evident in the auto sector. A downturn in domestic car sales extended into an eighth consecutive month in May, underscoring softening demand in the world’s largest auto market, where pressure is likely to persist through the rest of the year.
Travelers’ spending during the five-day Labour Day holiday in May was lukewarm, and the impact of the government’s consumer-goods trade-in scheme is fading. A high base from May last year also contributed to the decline.
At a bar in Shanghai’s financial district, manager Jie’ao Feng said his business has taken a hit from shrinking corporate entertainment budgets. He has been offering group deals to draw larger crowds, but this has squeezed margins.
Screening World Cup matches hasn’t helped much, he said, because of the late-night and early-morning scheduling of the matches, and he has had fewer customers in June than in May, when his sales saw a boost from the long holiday.
“Consumers are not as impulsive as before,” Feng said.
Zhiwei Zhang, chief economist at Pinpoint Asset Management, said that the weak retail sales data places pressure on the government to consider policy measures to stabilize consumption.
“I still expect policy ‘fine tuning’ will come in July after the second quarter GDP data is released.”
‘Divides characterized economy in May’
By contrast, industrial output rose 4.5% in May from a year earlier, picking up from 4.1% growth in April and beating expectations of a 4.3% increase.
A surge in global AI investment and related tech demand has helped the world’s biggest manufacturer offset the export hit many had expected from the Iran war. China’s high-tech manufacturing output rose 15.1% in May.
“Several divides characterized the economy in May: the divide between domestic and external demand, the divide between AI and the traditional industries, and the divide between goods retail and services consumption,” said Xu Tianchen, senior economist at the Economist Intelligence Unit.
Services consumption grew 5.4% in January-May, much better than goods sales, and is becoming a growing driver of household consumption, but it also slowed from 5.6% in the first four months.
Xu expected economic growth in the second quarter to slow to 4.5% from 5% in the first.
“For full-year 2026, achieving the growth target of 4.5-5% won’t be difficult, but soft domestic demand still warrants policy intervention in the second half.”
Investment slump deepens, property drag persists
Investment data was also much weaker than expected. Fixed-asset investment fell 4.1% in the first five months of 2026, following a 1.6% decline in January-April. Economists had expected a 2% fall.
NBS spokesperson Fu Linghui said the decline was due in part to high temperatures and heavy rain in some regions as well as the transition from old to new growth drivers.
China still has ample room for investment in the future, with new urbanization, rural revitalisation, the development of “new quality productive forces” and improvements in public services all requiring support, Fu added.
Property investment extended its decline in the first five months, dropping 16.2% compared with the same period last year after falling 13.7% in January-to-April. Property sales and new construction also fell more sharply.
On a month-over-month basis, new home prices fell at a slightly faster pace in May, even as larger cities showed tentative signs of stabilization.
Weak household loan data released last week suggested that people remain wary of borrowing to buy homes amid sluggish income growth and job insecurity.
The labor market is still under pressure, with about 12.7 million graduates leaving schools during the summer, while fears of AI displacement are causing worker anxiety. But the nationwide survey-based jobless rate eased to 5.1% from April’s 5.2%.
Economists say strong exports could continue to provide a prop to China’s economic growth this year, but its widening trade surplus may cause some disputes.
“The export boom can help to mitigate the weak domestic demand in the short term. But given the size of China’s economy, strong export growth will likely lead to tension with trading partners,” Zhang from Pinpoint Asset Management said, adding a potential trade conflict with Europe is a risk to watch in the coming months.
The Bank of Japan (BOJ) lifted its key policy rate to a 31-year high on Tuesday as it counters a spike in consumer prices caused by the Middle East war, even as Washington and Tehran agreed on a peace memorandum.
The central bank for the world’s fourth-largest economy raised its benchmark rate 25 basis points to 1.0%, the highest since 1995 and marking the first increase since December.
The widely expected decision followed rate hikes by the European Central Bank (ECB) and in Indonesia last week, after the conflict caused economic havoc and led to rising prices worldwide.
With U.S. inflation at a three-year high, expectations are growing that the Federal Reserve (Fed) will follow suit, albeit not at new boss Kevin Warsh’s first gathering this week.
“While higher crude oil prices have been exerting downward pressure on economic activity, the economy has generally been supported by factors such as high levels of corporate profits and an improvement in the employment and income situation,” the BOJ said.
The consumer price index (CPI) has been below 2%, thanks in part to government energy subsidies.
“However, the price pass-through stemming from the rise in crude oil prices has been progressing at a relatively fast pace in business-to-business transactions, which could spread to an increase in consumer prices across a wide range of items,” the central bank added.
“Against this backdrop, taking into account that medium- to long-term inflation expectations have also continued to rise, there is a risk of underlying CPI inflation deviating upward to a level above the price stability target of two percent.”
Looking ahead, the bank said that it will “continue to raise the policy interest rate and adjust the degree of monetary accommodation.”
“In this regard, it will consider the timing and pace of adjustment, while closely monitoring the impact of the future course of the situation in the Middle East on Japan’s economic activity and prices,” it said.
It also indicated that it would pause the tapering of its colossal program of bond purchases after next April.
U.S.-Iran deal
The U.S. and Iran agreed to end their three-month war on all fronts and reopen the Strait of Hormuz, through which about a fifth of the world’s oil and gas passed prior to the conflict.
The accord was set to be physically signed in Switzerland on Friday, but hundreds of ships remain stuck, and it will likely take considerable time for trade flows to normalize.
Japan relied on the Middle East for around 90% of its crude supplies before the war began on Feb. 28.
Its problems have been exacerbated by a falling yen, caused by the rise in oil prices and the gap between U.S. and Japanese interest rates, which are among the lowest in the developed world.
The government spent around 11.7 trillion yen ($72 billion) last month propping up the currency, which has been languishing at around 160 yen against the dollar.
The yen briefly jumped against the dollar after the announcement on Tuesday, while the Nikkei 225 stock index rose above 70,000 points for the first time.
BOJ deputy governor Shinichi Uchida was slated to address the media on Tuesday afternoon after the rate decision, filling in for governor Kazuo Ueda, who is in hospital.
The central bank is under pressure from markets to keep tightening interest rates, and also from Prime Minister Sanae Takaichi’s government not to snuff out growth with high borrowing costs.
The BOJ began hiking rates from below zero in 2024 after nearly two decades of ultra-loose monetary policies.
Akino Fukuda at Moody’s Analytics said Tuesday’s move was “another step toward policy normalization.”
“Real rates remain negative, financial conditions are still relatively loose, and inflation pressures are turning higher, so more hikes are necessary,” Fukuda said.
“The question now is the pace.”
Türkiye’s five-year credit default swap (CDS), a key gauge of the country’s sovereign risk, fell to 225 basis points on Monday, marking its lowest level since Feb. 26, as easing Middle East tensions lifted investor sentiment and boosted appetite for risk assets.
The decline coincided with a broad rally across global markets following the agreement between Washington and Tehran, which is expected to end months of conflict and pave the way for the reopening of the Strait of Hormuz, one of the world’s most important energy transit routes.
On Sunday, U.S. President Donald Trump announced that an agreement with Iran had been finalized and said he was authorizing the reopening of the Strait of Hormuz and the removal of a U.S. naval blockade.
“The Deal with the Islamic Republic of Iran is now complete. Congratulations to all!” Trump said in a post on his Truth Social platform.
The easing of Middle East tensions supported emerging-market assets, while lower oil prices improved sentiment toward energy-importing economies such as Türkiye.
CDS contracts are widely used by investors to insure against the risk of default on sovereign or corporate debt. A lower CDS level generally indicates reduced perceived credit risk and can support more favorable external borrowing conditions.
Türkiye’s risk premium had come under pressure earlier this year amid heightened regional tensions and concerns over potential energy supply disruptions.
The latest decline signals an improvement in market sentiment, supported by expectations that reduced energy-related risks could ease inflationary pressures and encourage capital flows into emerging markets.
Oil prices fell sharply following the U.S.-Iran agreement, as investors priced in the potential normalization of shipping through the Strait of Hormuz.
The decline in crude prices is particularly significant for Türkiye, which relies heavily on energy imports and is sensitive to movements in global oil and natural gas costs.
The improvement in Türkiye’s CDS also reflected broader optimism across international markets, as investors returned to risk assets following the de-escalation of tensions in the Middle East.
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