Australia Exchange Foreign Exchange July 31 financial breakfast: focus on the two major central bank interest rate decisions, pay attention to the yen central bank meeting notes

AohuiForex July 31st news - July 31st, this week focused on the Reserve Bank of Australia and the Bank of England interest rate decision, while paying attention to the yen central bank meeting notes, after the Bank of Japan said last week that it will flexibly control the 10-year bond yield, this week focused on whether the Bank of Japan has more measures to suggest.

Beijing time on Monday (July 31), this week focused on the Reserve Bank of Australia and the Bank of England interest rate decision, while paying attention to the yen central bank meeting notes, after the Bank of Japan said last week that it will flexibly control the 10-year bond yield, this week focused on whether the Bank of Japan has more measures to hint at.

Monday Forward

Market News

The Biden administration has proposed tougher fuel economy standards for cars

The National Highway Traffic Safety Board (NHTSA) on Friday proposed new fuel economy standards for models from 2027 to 2032, specifying the mileage per gallon that U.S. vehicles must travel. By 2032, automakers must sell a portion of light-duty cars and trucks that average 58 miles per gallon, up from the 49 miles per gallon currently required for the 2026 model year.

PetroChina has provided nearly 100 tons of oil and over 2,500 kilograms of hydrogen for the Universiade

It is learned from PetroChina (601857) that PetroChina is the official exclusive supplier of oil, gas and chemicals for the 31st Summer Universiade. As the main channel of PetroChina's refined oil supply in Sichuan, PetroChina Sichuan Sales Company added "oil" and "gas" for the Chengdu Universiade. As of July 27, Sichuan Sales Chengdu Branch has provided nearly 100 tons of oil products and more than 2,500 kilograms of hydrogen for the Universiade, and served more than 300 Universiade-related vehicles.

Putin: Does not want a direct conflict with NATO, but is ready to respond at any time

Regarding the possibility of a direct confrontation between Russian and NATO forces, Russian President Vladimir Putin said on July 29 that Russia is ready to deal with any situation. Russia does not want a direct conflict with NATO, but if someone wants it, Russia is also ready. According to Russian media reports, Western media have revealed NATO's action plan for dealing with war with Russia, which includes increasing the number of rapid reaction forces to 300,000. NATO Secretary-General Stoltenberg called it the largest defense plan since the Cold War, with more than 4,000 pages. It mentioned that NATO's allied commander-in-chief in Europe can make some decisions independently without additional consultations with NATO.

South Korea: Sales of high-priced imported cars hit a new high in the first half of the year

In the first half of this year, the sales of high-priced imported cars above 100 million won (about 78,000 yuan) in South Korea hit the highest level in the same period of the year, with nearly 3 high-priced cars in every 10 imported cars. According to the Korea Imported Car Association on the 30th, from January to June this year, the sales of imported cars above 100 million won in South Korea increased by 9.3% year-on-year, to 37,239. The proportion of high-priced cars in the overall imported car sales rose by 2.5 percentage points year-on-year to 28.5%. The sales of high-priced imported cars have increased rapidly in the past five years. For example, in the past half year, its proportion has increased from 10.1% in 2019 to nearly 30% this year, and it has nearly doubled in four years.

Foreign media: Saudi Arabia will host talks on Ukraine, plans to invite many countries to participate, but Russia is excluded

On July 29 local time, US media reported that Saudi Arabia will host talks on Ukraine in August, and plans to invite Western countries, Ukraine and major developing countries including India and Brazil to participate.

Russia extends rice export ban until the end of this year

The Russian government announced on the 29th that Russia has decided to continue the temporary ban on the export of rice and broken rice until December 31 this year, "to ensure the stability of the domestic market". The Russian government said in a social media "cable" that member states of the Eurasian Economic Union are not affected by the ban. In addition, Russia can ship rice abroad as humanitarian aid or under the "framework of international transit transportation." The members of the Eurasian Economic Union include Russia, Kazakhstan, Belarus, Kyrgyzstan and Armenia.

High temperatures blanket many parts of the United States, putting pressure on power systems

The heat has gripped many parts of the United States. In addition to the southwestern region of the United States, which has been scorched by high temperatures for many days, the East Coast cities including New York and Philadelphia have also become unbearably hot in the past two days. The largest power grid operator in the United States recently warned that the US power system is under tremendous pressure. Record heat waves pose a severe test to the US power system. PGM United Grid, the largest grid operator in the United States, has issued a level 1 energy emergency alert to 13 states and Washington, D.C., calling on people to save the use of high-power appliances such as air conditioners and set the air conditioner to a constant temperature of 25 or 26 degrees Celsius to avoid overloading the grid and causing power outages.

Precious metal

Gold rallied on Friday after falling sharply the day before, as signs of cooling U.S. inflation heated up market bets that the Federal Reserve might end its monetary tightening cycle and the dollar retreated slightly.US inflation slowed sharply at an annual rate in June, data released on Friday showed, with the personal consumption expenditure (PCE) price index rising 0.2 per cent last month, according to the commerce department.

"The core PCE that the Fed is really focused on is in line with expectations," said Edward Meir, a metals analyst at Marex who provides research services. "That's not surprising. Also, the dollar weakened today, which gave gold a bit of a boost." I don't think the Fed would actually mind seeing stronger data as long as inflation numbers continue to fall. The Fed may have finished raising interest rates, and generally I would be inclined to buy gold when it falls. "

Last Thursday's data showed that the U.S. economy grew faster than expected in the second quarter and initial jobless claims fell, boosting the dollar. Gold fell nearly 1.4% on Thursday, its worst day in nearly a month. However, the dollar fell 0.16% on Friday, making gold cheaper for holders of other currencies.

Spot silver rose 0.83% to $24.33 an ounce; platinum fell 0.23% to $933.81; palladium was nearly flat at $1,241.41.

crude oil

Oil prices rose last Friday for a fifth consecutive week, with investors optimistic that healthy demand and supply cuts will keep prices on the rise.

Rising expectations of the end of policy tightening by major central banks such as the Federal Reserve and the European Central Bank have boosted the outlook for global growth and energy demand, raising risk appetite in the broader financial marekt.

Both crude oil indicators rose nearly 5% this week, their fifth consecutive weekly gains, helped by the OPEC + coalition of producers announcing supply cuts earlier this month. The two indicators are expected to rise more than 13% this month.

Both crude oil benchmarks fell as much as $1 at the start of the session, and Phil Flynn, an analyst at Price Futures Group, said investors took profits after U.S. crude rose above $80 a barrel.

Bullish demand expectations were boosted on Thursday after data showed gross domestic product grew at an annualised rate of 2.4 per cent in the second quarter, beating expectations and supporting Federal Reserve Chairperson Jerome Powell's view that the economy could achieve a "soft landing".

Tamas Varga, an analyst at PVM, said investors' perceptions of a looming peak in interest rates were heating up, while the chances of the US avoiding a recession were growing. The latest data, released on Friday, showed some of the eurozone's leading economies showed surprising resilience in the second quarter, although a range of indicators pointed to renewed weakness ahead as manufacturing weakened and services slowed.

On the supply side, the number of active US oil rigs fell by one this week to 529, the lowest level since March 2022, according to Baker Hughes, the energy services company, a gauge of future supply.

foreign exchange

The yen had its most volatile session in months on Friday after the Bank of Japan tweaked its yield curve control policy, leaving investors wondering whether its massive stimulus package was approaching an eventual reversal.Traders digested the decision as the yen was in a tug of war. The yen was down 1.13 per cent at Y141.05 against the dollar in the afternoon in New York. The Bank of Japan said it would buy 10-year Japanese government bonds at 1.0 per cent in its fixed-rate operation and kept its short-term interest rate at minus 0.1 per cent, leaving its target for 10-year yields unchanged at around 0 per cent.

Karl Schamotta, chief market strategist at Corpay, said: "This is the first step towards tightening the overall monetary policy setting. It is really an acknowledgement that Japan is gradually emerging from its inflation trap and that we are seeing signs that the Bank of Japan will exit its accommodative monetary policy setting in the coming months and years."

Schamotta added that the prospect of higher Japanese government bond yields suggested that Japanese investors might keep more money at home rather than redeploy to overseas government bond markets, which would put pressure on global yields.

At the same time, the dollar fell against a basket of currencies as investors largely shrugged off new data showing slowing inflation as they continued to digest the decisions of several central banks this week to understand the outlook for monetary policy.

US annual inflation in June was the lowest in more than two years and core price pressures eased, a trend that, if sustained, could push the Federal Reserve closer to ending its fastest rate-raising cycle since the 1980s.

The Commerce Department said on Friday that inflation slowed sharply in the 12 months to June, with the personal consumption expenditure (PCE) price index rising 3.0 percent year-on-year, the smallest year-on-year increase since March 2021.

The dollar index fell 0.049 per cent to 101.630, while the euro rose 0.42 per cent to $1.1019. "The focus is back on growth and how high the US economy can sustain without inflation picking up again," said Adam Button, chief currency analyst at ForexLive. "There is a lot of uncertainty about where inflation will end up and how far the Fed will tolerate it. Right now, the market is looking at it data by data."

Earlier this week, as expected, the US Federal Reserve and the European Central Bank raised interest rates, raising the prospect that the ECB will pause interest rates in September, with signs of a temporary easing of inflationary pressures and growing recession fears.

The Federal Reserve has left room for further rate hikes, although Federal Reserve Chairperson Jerome Powell has given few hints about the September meeting.

The Federal Reserve must balance the fight against inflation with signs of an economic slowdown, but the economy is still growing faster than expected and the labour market is strong. Sterling was trading at $1.2854 in New York, up 0.48 per cent.