UOB’s Jester Koh raises Singapore’s 2026 GDP growth forecast to 4.8% from 4.0% after strong 1H26 performance, with manufacturing and electronics leading gains on AI-related demand.
Federal Reserve (Fed) Bank of Chicago President Austan Goolsbee said on Tuesday that the June Consumer Price Index (CPI) report was encouraging but cautioned against overreacting to a single month of data.
The US Dollar Index (DXY) comes under selling pressure on Tuesday after softer-than-expected United States (US) inflation data prompted traders to scale back expectations of an imminent Federal Reserve (Fed) interest rate hike.
Deutsche Bank strategists note that China’s latest trade figures significantly beat expectations, with both exports and imports accelerating in June. Strong global demand for AI-related and technology goods offset geopolitical pressures, widening China’s trade surplus well beyond consensus.
The Japanese Yen registers gains of over 0.31% against the US Dollar as traders trim hawkish bets following a softer-than-expected US inflation report. The USD/JPY trades at 161.93 after reaching a daily high of 162.48.
Silver (XAG/USD) trades on the front foot on Tuesday as softer-than-expected US inflation data tempers expectations of a near-term Federal Reserve (Fed) interest rate hike and pushes the US Dollar (USD) lower. At the time of writing, XAG/USD trades around $58.50, up nearly 2% on the day.
The June Consumer Price Index (CPI) fell 0.4% on the month against consensus for a 0.1% decline, following May's 0.5% increase, and the annual rate dropped to 3.5% from 4.2%, well under the 3.8% forecast. Core prices were flat MoM and eased to 2.6% YoY versus 2.8% expected.
United States (US) President Donald Trump reiterated in a Truth Social post on Tuesday, “The Strait of Hormuz is open to ALL ship traffic except for Iran.” He added that the US would impose a “FULL Blockade” only on vessels travelling to or from Iranian ports or carrying Iranian cargo.
While testifying on the Semiannual Monetary Policy Report before the US House Financial Services Committee, Federal Reserve (Fed) Chairman Kevin Warsh reiterated that the Fed is making a commitment on price stability and the goal of 2% inflation.
AUD/USD trades sharply higher near 0.6990 on Tuesday, approaching the psychological 0.7000 level as the US Dollar (USD) falls following weaker-than-expected United States (US) inflation figures.
The Canadian Dollar (CAD) strengthens sharply against the US Dollar (USD) on Tuesday, drawing support from softer-than-expected US inflation data and rising Oil prices amid escalating tensions in the Middle East.
ING’s Warren Patterson and Ewa Manthey report that European natural gas benchmarks are rising as Middle East developments threaten LNG flows from the Persian Gulf.
Gold (XAU/USD) rebounds sharply on Tuesday, erasing losses recorded on the previous day after softer-than-expected US inflation data eased expectations of a near-term Federal Reserve (Fed) interest rate hike.
Societe Generale economists describe China’s June trade surplus of $125.62bn, driven by 27% yoy export growth and 36% import growth, with AI-related high-tech shipments up over 50%.
NZD/USD jumps to a one-month high on Tuesday as traders digest the latest US inflation data, which came in softer than expected and reduced expectations of an imminent Federal Reserve (Fed) interest rate hike. At the time of writing, the pair trades around 0.5820, up nearly 1.23% on the day.
The Japanese Yen (JPY) continues to trade in defensive territory, with the USD/JPY pair pinned near a historic 40-year high around 162.00. However, in a striking divergence from rising global yields, Japanese Government Bonds (JGBs) have begun outperforming.
Bart Melek at TD Securities argues that money managers are heavily short crude based on what he views as misread market conditions, including pessimism on China demand and expectations of an oil glut.
Royal Bank of Canada (RBC) economist Claire Fan expects Canada’s economy to rebound in Q2 2026, supported by resilient household spending, recovering business investment and expanding net trade.
The British Pound (GBP) strengthens against the US Dollar (USD) on Tuesday after US inflation data surprised to the downside, reducing expectations of a near-term Federal Reserve (Fed) interest rate hike.
Societe Generale notes Bank Indonesia’s (BI) reaction function is driven by the Indonesian Rupiah (IDR) and exchange rate stability. The report says the Rupiah faces pressure from a stronger US Dollar (USD) and hawkish Federal Reserve (Fed) pricing, with stress around USD/IDR 18,000.
ING economists Peter Virovacz and Frantisek Taborsky turn more optimistic on Hungary’s growth outlook, noting positive surprises in high-frequency data and stronger consumption. They still project 1.5% GDP growth in 2026 but now see clear upside risks.
EUR/USD snaps a two-day losing streak on Tuesday as softer-than-expected United States (US) inflation data weighs on the US Dollar (USD) and prompts traders to scale back expectations of a near-term Federal Reserve (Fed) interest rate hike.
TD Securities’ Julie Ioffe and James Rossiter argue that the European Union already possesses key ingredients for stronger long-term growth, including wealthy consumers, productive workers, deep private savings and solid fiscal capacity.
Rabobank revises its TTF Natural Gas and JKM forecasts higher for Q3 and Q4 2026, citing a structurally tight LNG market and deeper Qatari export losses following renewed Hormuz disruption.
MUFG’s Lee Hardman reports the New Zealand Dollar is the top G10 performer overnight, helped by a hawkish shift in RBNZ rate expectations.
Annual inflation in the United States (US), as measured by the change in the Consumer Price Index (CPI), declined to 3.5% in June from the three-year high it set at 4.2% in May, the US Bureau of Labor Statistics (BLS) reported on Tuesday. This print came in well below the market expectation of 3.8%.
ING’s Francesco Pesole argues that the EUR/USD short-term rate differential is currently supporting the Euro as Gulf tensions rise, helped by a recovery in EUR front-end rates.
GBP/JPY trades in a narrow range on Tuesday as market sentiment remains fragile amid escalating tensions between the US and Iran, which are driving Oil prices higher once again. At the time of writing, the cross trades around 217.10 as the Japanese Yen (JPY) remains broadly weak.
Brown Brothers Harriman’s (BBH) Elias Haddad notes USD/JPY is trading near a 40‑year high above 162.00 while Japanese Government Bonds are outperforming. Strong demand at the 20‑year auction and comments from Finance Minister Satsuki Katayama encouraging more domestic investment support JGBs.
The New Zealand Dollar (NZD) extended gains against the Aussie Dollar (AUD) on Tuesday.
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