The Australian dollar inched up on Thursday though a tanker was struck by an unknown projectile off Saudi Arabia and Washington threatened to bomb Iranian infrastructure.
The labour market showed unexpected strength in June, blowing past consensus forecasts. This economic durability has convinced investors that a further interest rate hike will be necessary to cool inflationary pressures.
In an intensified effort to curb inflation, the RBA raised its benchmark interest rate three times this year to 4.35%, completely cancelling out the policy easing implemented in 2025.
Furthermore, policymakers explicitly cautioned that the tightening cycle may extend further, citing risks from rising energy costs filtering through the domestic economy.
The re-escalation of geopolitical conflict in the Gulf is putting severe upward pressure on Asia growth. The oil market is now increasingly wondering how China will respond to the protracted supply disruption.
Trump plans tariffs of up to 200% on imported generic drugs. Pharmaceuticals are one of the biggest Australian export industries to the US, worth an estimated billion dollars every year.
EBC Financial Group analyst says, the Aussie remained below the 50 SMA despite a significant rally. If it fails to close above $0.7017, a classic dead cat bounce would be proved, signalling a treat towards $0.6950.
Asset recap
As of market close on 22 July, among EBC major products, Penske Automotive Group shares led gains after Penske Corp and Mitsui make $3.8 billion offered to take the auto retailer private.
ServiceNow were pulling back after disappointing results from Pegasystems, a small-cap enterprise automation software company, seemed to confirm a trend that customers were delaying software orders as they spend on AI.
Gold prices rebounded strongly to hit over a two-week high, primarily driven by technical buying and renewed geopolitical tensions in the Middle East.
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