American and Chinese negotiators said late Tuesday they had agreed on a framework to get their trade talks back on track. Officials said the framework would essentially restore the pact struck last month that saw both countries lower tariffs.

Trump’s far-reaching tariffs are likely to remain in effect for at least the next two months. A federal appeals court granted the administration’s request to keep them in effect until it hears arguments on July 31.

With the U.S. and China salvaging their trade truce, investors are turning their focus to the latest inflation data.

Data due at 8.30 a.m. ET are expected to show the annual rate of inflation edged up to 2.4% in May, from 2.3% in April, according to economists polled by The Wall Street Journal. Read more.

The World Bank said it expects the U.S. economy to grow by just 1.4% in 2025, a sharp deceleration from the 2.8% expansion recorded in 2024. In its January report on the outlook for the global economy, the World Bank forecast a 2.3% increase in U.S. gross domestic product.

“Global growth prospects have deteriorated,” said Indermit Gill, the World Bank’s chief economist. “Without a swift course correction, the harm to living standards could be deep.”

The U.S. government’s outsize debt load is the talk of Wall Street. Some of the biggest names in finance are speaking in increasingly alarmed tones about an issue that has bothered investors for decades. Ray Dalio, founder of the hedge fund Bridgewater Associates, has warned of a debt crisis akin to an “economic heart attack.” Jamie Dimon, chief executive of JPMorgan Chase, is predicting a breakdown in financial markets. Here is a look at how the government borrows and what it means for markets and the economy.

7 a.m.: MBA Weekly Mortgage Applications Survey
8:30 a.m.: Consumer Price Index
1 p.m: U.S. Securities and Exchange Commission Open Meeting
4 p.m.: U.S. Secretary of the Treasury Scott Bessent testifies to Senate Appropriations subcommittee on FY'26 budget

8:30 a.m.: Producer Price Index
8:30 a.m.: Unemployment Insurance Weekly Claims Report, Initial Claims
9:30 a.m.: IMF regular press briefing with Strategic Communications Director Julie Kozack
10 a.m.: Quarterly Services Report
12 p.m.: World Agricultural Supply & Demand Estimates
4:30 p.m.: Foreign Central Bank Holdings
4:30 p.m.: Federal Discount Window Borrowings

The U.S. dollar firms against most major currencies, helped by prospects of a positive outcome from U.S.-China trade talks, which continued on Tuesday. The dollar trims its earlier gains, however. Investors are cautious ahead of U.S. inflation data and this week’s Treasury auctions, where weak demand could send the dollar lower. “The only potential upside for the dollar this week hinges on U.S.-China trade negotiations in London, though no significant outcome has been revealed yet,” Convera’s Antonio Ruggiero says in a note. — Emese Bartha

• Fitch Ratings revises the 2025 outlook for global sovereigns to "deteriorating" from "neutral," saying tariffs and uncertainty "will weaken the global growth outlook and heighten the risk of more testing financing conditions." The headwind adds to uncertainty over the path of Fed rates "and the risk of volatility in financing conditions," Fitch says. Emerging markets face the added risk of dwindling U.S. international aid, offset by a weakening dollar. (Dow Jones Newswires)
• The European Central Bank’s most recent rate cut will help ensure that inflation doesn’t settle below its 2% target, Chief Economist Philip Lane said Wednesday. 
• U.K. Treasury Chief Rachel Reeves presents the government's spending review on Wednesday. This could boost U.K. government bonds, or gilts, if Reeves sends the right message, Aberdeen's Matthew Amis says in a note. If Reeves shows she is determined to stick to her fiscal rules then she could protect gilt yields from being dragged upward if there is a selloff in U.S. Treasuries, he says. (Dow Jones Newswires)
• The NFIB small-business optimism index has notched its first monthly gain since December, likely coinciding with easing trade tensions with China, economists at Oxford Economics write. The Oxford team notes that the share of firms in the NFIB survey planning to raise prices because of tariffs is steadily growing. (Dow Jones Newswires)

WSJ Pro Central Banking brings you central banking news, analysis and insights from WSJ’s global team of reporters and editors. This newsletter was compiled by news associate Roshan Fernandez in New York. Send your tips, suggestions and feedback to roshan.fernandez@wsj.com.