📊 Global Markets Update: Inflation, Central Banks & AUD Strength 🌏💱
🇺🇸 In the US, June CPI rose 2.7% YoY—slightly higher than expected and the highest in 4 months. Core CPI held steady at 2.9% YoY. Energy price rebounds drove much of the increase, but there are signs that tariffs are starting to push up costs in core goods as businesses exhaust their buffers.
Although the monthly core CPI (+0.2%) was softer than markets predicted, a closer look shows service sector costs (“super core CPI”) rose 0.36% MoM, keeping inflation pressures alive.
📉 Markets are still betting on a Fed rate cut in September (62% probability), but attention is now firmly on the Core PCE data due July 31. This is the Fed’s preferred inflation gauge and could shape its next move.
⚠️ Adding to the uncertainty, political tensions arose as reports suggested former President Trump considered removing Fed Chair Powell. While Trump denied immediate action, his comments raised concerns over central bank independence, triggering volatility in the USD and bond markets.
🇦🇺 Australia: AUD Strength Amid RBA Caution
AUD/USD climbed to 0.6595—an 8-month high—supported by strong labour market data and firm commodity prices. The RBA kept rates at 3.85%, opting to wait for further economic signals before adjusting policy.
Key upcoming data:
📅 July 18 – Australian Employment Report
📅 July 30 – Q2 CPIThese releases will be critical in determining whether the AUD can maintain its upward momentum or face renewed pressure.
📊 Technical Levels to Watch:
✅ Support: 0.6500
✅ Resistance: 0.6595 / 0.6680The Australian dollar remains highly sensitive to global risk appetite, US-China trade relations, and domestic economic trends.
💡 Takeaway:
Global markets are navigating complex forces—moderating inflation, political risks, and cautious central banks. For forex traders and investors, staying informed and agile will be key in the weeks ahead.