Dollar Holds Steady Ahead of U.S. CPI as Oil Surge, Middle East Tensions Keep Markets on Edge 
Asian Currencies Hold Steady as Middle East Tensions Offset Weaker US Dollar 
Australia Consumer Sentiment Rises in July as Fuel Price Relief Lifts Confidence 
Gold Prices Slip as Oil Rally Fuels Inflation Fears, Strengthens Dollar 
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 
Oil Prices Surge as U.S.-Iran Conflict Escalates and Strait of Hormuz Risks Grow 
Dollar Slides as Softer US Inflation Dims Fed Rate Hike Expectations 
US Inflation Expected to Ease in June, but Fed Rate Hike Risks Persist Amid Middle East Tensions 
ECB's Kocher Says No Inflation Spillover Yet From Iran Conflict, Warns Risks Remain 
South Korea Raises Interest Rates to 2.75% as Inflation and Weak Won Drive Tightening 
Asian Stocks Rise as Softer U.S. Inflation Boosts Sentiment Despite Middle East Tensions 
U.S. Imposes 25% Tariff on Select Brazilian Imports After Section 301 Trade Investigation 
US Stock Futures Hold Steady as Soft Inflation Data Eases Fed Rate Hike Fears 
Oil Prices Rise as U.S. Strikes on Iran Raise Strait of Hormuz Supply Fears 
Oil Prices Climb as Trump Escalates Iran Pressure, Strait of Hormuz Risks Grow 
Asian Stocks Slide as Chip Selloff Deepens Ahead of TSMC Earnings 
The Japanese yen regained some strength on Monday after suffering a sharp decline late last week, as investors reassessed the outlook for interest rate hikes in Japan and the likelihood of government intervention during thin end-of-year trading. Currency markets remained cautious, with traders closely watching signals from the Bank of Japan (BOJ) and global geopolitical developments.
According to a summary of opinions released after the BOJ’s December policy meeting, policymakers debated the need to continue raising interest rates. The central bank recently lifted its policy rate to 0.75%, the highest level in 30 years, up from 0.5%. Despite the increase, many board members noted that Japan’s interest rates remain deeply negative in inflation-adjusted terms, suggesting further tightening could be necessary. Expectations around future BOJ rate hikes have become a key driver for the yen’s performance.
Japan’s Finance Minister Satsuki Katayama reiterated last week that authorities have the freedom to respond to excessive currency moves, reinforcing the possibility of yen intervention. These warnings have helped limit aggressive dollar-yen positions, although broader pessimism toward the yen persists. Market participants are increasingly expressing bearish views through cross-currency trades, particularly against higher-yielding currencies such as the Australian dollar. Analysts note that the yen’s traditional role as a safe-haven currency is being questioned amid shifting global monetary dynamics.
The yen strengthened about 0.3% to around 156 per dollar after falling roughly 0.5% on Friday. The U.S. dollar index edged lower, while the euro gained modestly, supported by optimism after U.S. President Donald Trump signaled progress toward a potential peace agreement between Russia and Ukraine following talks with Ukrainian President Volodymyr Zelenskiy.
Attention now turns to the release of minutes from the U.S. Federal Reserve’s December meeting, which could provide further insight into the future path of U.S. interest rates. Elsewhere, the Australian and New Zealand dollars were largely unchanged. In the cryptocurrency market, bitcoin and ether posted moderate gains, reflecting a cautiously positive risk sentiment.
