Australia and US Inflation Reports Shape Market Outlook

Australia's Q2 consumer price index came in below expectations, with headline inflation rising only 0.6% and the trimmed‑mean measure up 0.8% year‑on‑year. The slowdown reflects lower auto‑fuel prices, a temporary fuel excise tax cut and falling global oil prices. Westpac chief economist Luci Ellis said the bank no longer expects further rate hikes in 2026, leaving the cash rate at 4.35% as a restrictive stance.

In the United States, June personal consumption expenditures (PCE) data were cooler than forecast and Q2 GDP growth missed expectations. Despite the softer numbers, the 30‑year Treasury yield hovered near 5.24%, the highest since 2007, and market pricing for a September Fed rate hike rose to about 63%. The Fed kept policy rates unchanged, while bond markets and equity traders adjusted positions amid volatility in semiconductors, oil and broader equity indices.