“Markets Retreat on Fed Uncertainty; Oil Rebounds, AUD Steady Ahead of CPI

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Forex Market 

 

USD: Mixed with Fed Commentary The USD traded mixed as Fed Chair Powell offered no clear guidance on future rates. Dovish remarks from Fed’s Bowman weighed on the greenback, while U.S. PMI data was modestly weaker.
  • EUR/USD bounced from 1.1781 lows to 1.1805 after stronger German PMI (52.4 vs. 50.7 est.) offset weaker French PMI (48.4 vs. 49.7 est.).
  • GBP/USD fell to 1.3489 on weak UK PMI data before recovering to 1.3535 highs.
  • USD/JPY traded between 147.47–147.93, ending softer near the lows.
  • USD/CAD slipped to 1.3812 before rebounding to 1.3850, later easing back.
  • AUD/USD ranged tightly between 0.6582–0.6616, holding steady near 0.6600 ahead of Asia.
AUD: Narrow & Steady AUD/USD once again oscillated in a confined range, supported at 0.6580 with selling pressure near 0.6620. Demand remains intact as traders await today’s Australia CPI release. 

Key Economic Data Ahead (Sydney Time)

 

General Market

Wall Street
U.S. equities pulled back from record highs:
  • Dow Jones -0.2%
  • S&P 500 -0.6%
  • Nasdaq -0.9%
The U.S. 10-year yield eased 4 bps to 4.11%. WTI crude snapped a four-day losing streak, climbing +2.1% to US$63.60/bbl.  
Asia-Pacific
Asian equities were mixed:
  • Nikkei +1.0%
  • Shenzhen -0.1%
  • Hang Seng -0.9%
The ASX 200 gained +0.4%, supported by financials and materials. AUD/USD slid to 0.6582 into the local close.
Europe
European equities opened higher and mostly held gains:
  • CAC +0.5%
  • DAX +0.4%
  • FTSE flat
  • Stoxx +0.2%
U.K. 10-year Gilts were bid at 4.6% as weak UK PMI weighed on sentiment. Brent crude slipped -0.5% to US$66.30/bbl. 

Headlines to Watch

  • Fed Outlook – Powell highlighted tariff-driven price pressures and rising employment risks; Bowman leaned dovish, urging decisive cuts to avoid lagging behind labor market weakness.
  • U.S. Data – Manufacturing PMI (52.0 vs. 52.2 est.) and Services PMI (53.9 vs. 54.0 est.) slightly softer; Richmond Fed Index fell to -17 (vs. -5 est.).
  • UK PMI Disappointment – Composite 51.0 (vs. 53.0 est.), dragging GBP lower before partial recovery.
  • Oil Prices – WTI crude rebounded +2.1% to US$63.60/bbl, while Brent slipped -0.5% to US$66.30/bbl.
  • Trade Balance – U.S. Q2 trade deficit narrowed to $251.3b (vs. $256.6b exp.).

Mid-market rates

Currency PairMid-market Rate
AUD/USD0.6593
AUD/NZD1.1261
AUD/JPY97.43
AUD/CNY4.6882
AUD/EUR0.5586
AUD/GBP0.4879
AUD/HKD5.1248

 

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