ECB's Kocher Says No Inflation Spillover Yet From Iran Conflict, Warns Risks Remain 
US Inflation Expected to Ease in June, but Fed Rate Hike Risks Persist Amid Middle East Tensions 
Iraq PM Visits Washington as U.S. Oil, Gas Deals Take Center Stage 
China Home Prices Fall Again in June Despite Slower Pace of Decline 
Gold Prices Fall as US-Iran Conflict, Rising Oil Prices Fuel Fed Rate Concerns 
Dollar Slides as Softer US Inflation Dims Fed Rate Hike Expectations 
Goldman Sees Foreign Investors Driving India Stock Market Recovery 
Dollar Rises as Middle East Conflict Fuels Inflation and Rate Hike Fears 
Singapore GDP Grows 5.7% in Q2 2026 as AI-Driven Manufacturing Boosts Economy 
Oil Prices Climb as Trump Escalates Iran Pressure, Strait of Hormuz Risks Grow 
Gold Price Holds Near Record High as Cooling U.S. Inflation Offsets Fed Caution 
China Q2 2026 GDP Misses Forecast as Weak Domestic Demand Offsets Export Strength 
Japanese Yen Holds Steady as Intervention Hopes Grow Ahead of U.S. CPI Data 
South Korea’s KOSPI Enters Bear Market Despite Remaining 2026’s Best-Performing Major Stock Index 
European Stocks Slip as Middle East Tensions and Hormuz Threat Rattle Markets 
Asian Currencies Stay Rangebound as Middle East Tensions, Weak China GDP Weigh on Sentiment 
Asian Stocks Rise as Softer U.S. Inflation Boosts Sentiment Despite Middle East Tensions 
Asian currencies weakened on Friday as stronger-than-expected U.S. economic data pushed the dollar higher and reinforced market expectations that the Federal Reserve could maintain a hawkish monetary policy stance through 2026. The Indian rupee fell to a fresh record low against the U.S. dollar, while other major Asian currencies also posted weekly losses.
The U.S. Dollar Index gained 0.2% during Asian trading hours, marking its fifth consecutive daily advance and putting it on track for its biggest weekly rise in over two months. Investors reacted to a series of solid U.S. economic indicators, including April retail sales data, which showed a 0.5% increase, in line with market forecasts. Weekly jobless claims also remained low, signaling continued strength in the U.S. labor market. Meanwhile, import prices surged 1.9%, driven by rising fuel costs.
Recent inflation reports in the United States also came in above expectations, further reducing hopes for Federal Reserve rate cuts this year. According to CME FedWatch data, the probability of a 25-basis-point Fed rate hike in December climbed to nearly 40%, compared to 22% last week.
The Japanese yen weakened slightly, with the USD/JPY pair rising 0.1% and heading for a 1.2% weekly gain. The South Korean won also declined, with USD/KRW advancing 0.3% for the day and 2.5% for the week. The Australian dollar dropped 0.5%, while the Singapore dollar remained under pressure as USD/SGD moved higher.
Attention also remained on the ongoing Trump-Xi summit in Beijing. Chinese President Xi Jinping said progress had been made in trade negotiations with U.S. President Donald Trump, although concerns over Taiwan and broader geopolitical tensions continued to weigh on investor sentiment. Markets showed limited optimism after the first day of talks ended without major trade agreements or policy announcements.
The Indian rupee remained one of the weakest performers in Asia, with USD/INR climbing to a record 95.96. Rising crude oil prices, foreign capital outflows, and concerns over India’s growing import bill added pressure to the currency. Analysts noted that India remains highly vulnerable to energy price shocks due to its heavy reliance on oil imports, especially amid disruptions in the Strait of Hormuz.
Currency analysts at MUFG said they remain cautious on the rupee outlook, warning that the INR could continue underperforming against both G10 and Asian currencies even if geopolitical tensions ease.
