Cliff Notes: Policy Matters

The article reviews major central-bank and macro developments with market implications for FX, rates, equities and commodities. For AUD, the RBA kept rates unchanged at 4.35% but signaled hikes are still possible if inflation stays sticky, which supports a hawkish bias for the Australian dollar. Westpac expects further RBA hikes in August and September. The BoJ raised rates 25 bps to 1.0% and kept JGB tapering in place, reinforcing a firmer yen backdrop over time. The Fed held steady, though the new chair emphasized price stability and markets remain alert to the possibility of at least one hike this year. The BoE also stayed on hold but retained a hawkish tone. In commodities, easing Middle East tensions and the reopening of the Strait of Hormuz helped Brent crude fall sharply from near $110 to $79, a bearish signal for oil. Overall, the piece is broadly hawkish on developed-market policy and highlights lower geopolitical risk, which supports the USD and pressures oil.