U.S. futures inch down following an upbeat session on Monday that saw global stocks touch a fresh intraday record, with traders eyeing a resumption in trade talks between the U.S. and Canada and a weakening dollar. U.S. President Donald Trump ratchets up his campaign against Federal Reserve Chair Jerome Powell, sending the central bank head a scathing handwritten letter urging him to quickly bring down interest rates. Powell is scheduled to speak at a much-anticipated panel discussion with global central bank heads at the European Central Bank’s annual forum in Portugal. Elsewhere, the White House is reportedly narrowing the scope of its targeted trade deals as an impending expiration to a delay to Trump’s punishing "reciprocal" tariffs looms large.

1. Futures tick lower

U.S. stock futures pointed slightly lower on Tuesday, suggesting that recently bullish investors were taking some caution as they assessed headlines around trade and fiscal policy and prepared for the release of key labor market data later this week.

By 03:32 ET (07:32 GMT), the Dow futures contract had inched down by 30 points, or 0.1%, S&P 500 futures had slipped by 11 points, or 0.2%, and Nasdaq 100 futures had fallen by 56 points, or 0.3%.

The main averages on Wall Street advanced in the prior session, underpinned by hopes for renewed trade talks between the U.S. and Canada. However, sentiment was somewhat dented by worries that a massive tax-cuts and spending bill currently being debated in the U.S. Senate would expand the already massive $36.2 trillion federal debt pile.

“Notwithstanding some intra-day volatility based on errant headlines, there’s little acute anxiety around either the reconciliation bill or tariffs,” analysts at Vital Knowledge said in a note.

Financial markets are also keeping tabs on upcoming economic data this holiday-shortened trading week, particularly the June nonfarm payrolls report on Thursday. Today, the key data point for traders will be a tracker of activity in the U.S. manufacturing sector.

2. Trump steps up criticism of Fed’s Powell

President Trump stepped up his attacks on Fed Chair Jerome Powell on Monday, sending the central bank leader a note criticizing him for being "as usual, too late" on cutting interest rates.

In a handwritten letter that came with a list of policy rates from central banks around the world, Trump urged Powell to lower borrowing costs by "a lot," arguing that "hundreds of billions" of dollars are "being lost."

Trump added in a social media post displaying the letter that the U.S. should be paying "1% interest or better."

Following the Fed’s decision to leave rates at a target range of 4.25% to 4.5% after a two-day meeting last month, Powell has backed a wait-and-see attitude to future policy actions as a prudent approach during a time of uncertainty around the impact of Trump’s aggressive tariff agenda on the wider economy. Concerns have swirled around the potential inflationary effect of the levies, although price gains have stayed relatively muted in recent weeks.

Exasperated with a perceived lack of action compared to rate-cutting cycles being deployed by other global central banks, Trump has launched a barrage of verbal and written attacks at Powell and is reportedly mulling over naming a potential successor to Powell later this year. Such a move could create a so-called "shadow" Fed chair which may diminish Powell’s ability to sway policy decisions, analysts have suggested.

3. Uncertainty at Sintra

Powell will be in the spotlight again on Tuesday, when he is due to appear in a panel discussion at the European Central Bank’s annual forum in Sintra, Portugal.

ECB President Christine Lagarde, as well as the heads of central banks from Japan, Britain and South Korea, are set to join Powell for the discussion at 13:30 GMT.

Reports have predicted that the talk will partly focus on whether the role of the U.S. dollar as the world’s go-to currency for saving and investing is changing. The greenback has endured its worst start to a year since the 1970s, driven down in part by Trump’s more protectionist trade stance.

But "uncertainty" is seen as the likely buzzword at the event, especially as the direction of sweeping U.S. tariffs and the Trump-backed fiscal package remains unclear. In her opening remarks on Monday, Lagarde said that this lack of clarity should be an ongoing and major feature of the global economy.

4. U.S. narrows trade ambitions - FT

U.S. trade officials under Trump are pivoting to narrower trade agreements in a bid to secure quick wins ahead of a July 9 deadline, when steep reciprocal tariffs are set to return, the Financial Times reported on Tuesday, citing people familiar with the talks.

The administration is seeking “agreements in principle” on limited issues with select countries to avoid the reimposition of tariffs as high as 50%, the FT report stated.

These phased deals mark a retreat from Trump’s original pledge to strike 90 comprehensive trade agreements during a 90-day pause in tariff enforcement, which began on April 2.

While such agreements may spare countries from the harshest levies, a 10% baseline tariff would remain in place as negotiations on broader issues continue.

However, talks remain complicated, and alongside the narrower deal approach, the administration is still considering tariffs on key sectors, the FT reported.

5. Crude choppy

Crude prices were volatile after they touched a three-week low fueled by easing supply concerns and expectations of an OPEC+ production hike.

At 03:38 ET, Brent futures had slipped 0.4% to $66.47 a barrel. It earlier fell to its lowest level since June 11, shortly before the onset of the Israel-Iran war. U.S. West Texas Intermediate crude futures dropped 0.5% to $64.81 a barrel.

The Organization of the Petroleum Exporting Countries and allies, known as OPEC+, is set to meet on July 6, and Reuters reported last week that the group will increase output by 411,000 barrels per day in August, following similar hikes in May, June, and July.

The increase would bring OPEC+’s total supply increase for the year to 1.78 million barrels per day, although the hike is still smaller than the total number of production cuts enacted by the producers’ group in the past two years.