Last week, spot gold prices declined, ending a four-day winning streak; the US dollar index rebounded, while escalating tensions in the Middle East boosted oil prices. Spot gold traded around $4042.65 during the session, after hitting a two-week high of $4165 on Wednesday. Renewed tensions pushed WTI crude oil to its highest level since June 11, with prices approaching $92.50 per barrel, a nearly 30% increase this month.

On Thursday, the European Central Bank announced its interest rate decision at 20:15 Beijing time, maintaining the main refinancing rate at 2.40% and the marginal lending rate at 2.65%, in line with market expectations. Following the announcement, the euro fell about 10 points against the dollar, touching around 1.1385. European stock indices saw limited movement, and the overall market reaction was relatively mild. In terms of exchange rates, the euro/dollar exchange rate may fluctuate around current levels, awaiting further data confirmation. European stock indices lack clear direction in the short term and will need to pay attention to Lagarde's balanced statements at her press conference for further calibration of market expectations. The overall trend extrapolation depends on the evolution of geopolitical and energy factors and the verification of economic data. Both short- and long-term logics point to cautious data-driven trends rather than predetermined paths.

Currently, the Japanese yen is deeply mired in a historically weak position, with its exchange rate continuously hitting multi-year lows, once reaching 164, a 40-year low since December 1986, becoming a core focus of the global foreign exchange market. The yen has not only depreciated sharply against the US dollar, but has also weakened across the board against the euro, the British pound, and most Asian currencies, fully demonstrating the global nature of this round of yen depreciation.

The OPEC+ oil-producing alliance is likely to agree at its August 2nd meeting to further increase production targets starting in September. It is expected that the seven core member countries will increase production by approximately 188,000 barrels per day, consistent with the increases in June, July, and August. This decision will be made against the backdrop of the ongoing war with Iran, attacks on oil tankers in the Red Sea, and disruptions to oil transportation in the Gulf region—although some member countries are unable to increase production due to the conflict, the alliance still hopes to gradually regain market share as planned.

Last Week's Market Performance Review:

Last week, the three major US stock indices diverged. Investors assessed the latest developments in the Middle East situation and potential US-Iran negotiations while digesting earnings reports from technology companies. A concentrated sell-off in chip stocks dragged down the Nasdaq, while a surge of about 3% in Apple shares pushed the Dow Jones Industrial Average up by over 200 points. For the week, all major US stock indices declined. The S&P 500 fell 0.6% to 7411.98; the Nasdaq fell 2.1% to 24975.82, both marking their second consecutive weekly decline; and the Dow Jones Industrial Average fell 0.4% to 51947.25, its third consecutive weekly loss.

Last week, spot gold prices stabilized after Thursday's sell-off; traders weighed multiple factors: strong signals from the US labor market, the European Central Bank maintaining interest rates, persistently high international oil prices, and firm US Treasury yields. Spot gold traded around $4052.00 per ounce, up 0.85% for the week.

Spot silver rose 3.8% last week to close at $58.120 per ounce, reversing an earlier decline of more than 3%, as investors assessed the situation in the Middle East for clues about energy-driven inflation risks and the outlook for US interest rates. Concerns about disruptions to oil supplies in the Gulf region pushed up crude oil prices, reinforcing expectations that interest rates might remain high and putting pressure on precious metals.

Last week, the US dollar index closed at 101.45, halting its rise from a one-month high of 101.55 reached on July 23, as a slight pullback in energy prices reduced market expectations for a Federal Reserve rate hike this month. However, the index is still only 0.3% below the 15-month high reached at the end of June. Safe-haven demand coupled with expectations of a rate hike pushed the dollar index higher, putting pressure on non-US currencies such as the euro and pound sterling. The most extreme example was the yen: the dollar broke through 163 against the yen, with the yen hitting a 40-year low.

The euro/dollar pair fell to an intraday low below 1.1400 during Friday's US session, closing at 1.1370. Mixed S&P Global Purchasing Managers' Index (PMI) data, with manufacturing output contracting in July while service sector activity expanded, failed to trigger a significant market reaction. Market focus remained on developments in the Middle East and inflation-related concerns. The dollar/yen pair consolidated its gains from the previous day's strong rally to a 40-year high near 164.00. The pair was supported by verbal intervention from Japan and a rebound in Japan's overall consumer price index (CPI) inflation, while the dollar and oil prices retreated. All eyes remained on the upcoming Japanese foreign exchange intervention and the Middle East situation.

Following a sharp decline mid-week, the pound/dollar pair closed at 1.3325 on Friday, supported by positive UK retail sales and July Purchasing Managers' Index (PMI) data. However, upside for the pair remained limited as investors remained cautious due to further escalation in the Middle East. The US July PMI data failed to trigger significant price movement. The Australian dollar closed at 0.6980 against the US dollar last week. While it rose slightly, the overall trend was weaker as a surge in US Treasury yields, driven by rising expectations of hawkish Federal Reserve rates, dampened investor risk appetite.

WTI crude oil prices ended a three-day winning streak, closing at around US$89.20 per barrel at the weekend close. However, WTI crude oil prices are on track for a 10% gain this week. This sharp rebound comes amid escalating tensions in the Middle East, fueling strong concerns about widespread disruptions to global oil supplies.

The cryptocurrency market shifted from consolidation to weakness last week, with Bitcoin falling below $65,000, experiencing a daily drop of nearly 2%. Bitcoin is currently trading at around $64,890, having touched a low of $64,728.00 during the session, a significant pullback from its intraday high of $66,311.11. Since its drop to $57,750 on July 1, Bitcoin has rebounded by more than 12%, but has failed to hold the $66,000 to $66,800 area multiple times this week. The latest pullback indicates that as the previous rebound momentum gradually weakens, some short-term funds are beginning to take profits, and the market is retesting the support level around $65,000.

Federal Reserve Chairman Kevin Warsh is facing the most severe challenge to the bond market since taking office. A large-scale sell-off of Treasury bonds has driven yields up rapidly, and market expectations for the inflation outlook and the Fed's policy direction are undergoing dramatic adjustments. Latest market data shows that the 10-year US Treasury yield has climbed to 4.71%, a new high since January 2025; the 30-year Treasury yield is approaching 5.18%, reaching a near 19-year high. The continued rise in yields has directly pushed up US mortgage rates and corporate financing costs, with the US government's annual debt interest payments exceeding one trillion US dollars, broadly impacting all sectors of the economy.

Market Outlook This Week: This week (July 27-31) is a super week for global central banks, with the OPEC+ meeting and key economic data from multiple countries, marking a watershed moment for short-term asset price direction. The main themes are: Fed policy statement > Middle East geopolitical oil price fluctuations > central bank decisions > corporate earnings reports.

On Wednesday (July 29) at 02:00, the Fed will announce its FOMC interest rate decision, followed by a press conference at 02:30 with the Chairman. The market consensus is that interest rates will remain unchanged. The focus is not on whether there will be a rate hike this time, but rather on how the Fed will assess oil prices and inflation, and how it will signal a potential rate hike in September. Currently, CME futures prices indicate a higher probability of a September rate hike.

Friday (July 31st) - Bank of Japan Interest Rate Decision; the yen is currently under pressure, with the key focus on whether it releases signals of further interest rate hikes, directly impacting the USD/JPY exchange rate.

Risk Warning: Key attention should be paid to data and policy variables.

1. Unexpectedly Hawkish Fed Stance [Biggest Macroeconomic Risk]

If the Fed Chairman explicitly retains the option of a September rate hike, US Treasury yields will surge again:

→ Negative for global growth stocks, gold, and non-US currencies; Positive for the US dollar.

This is the biggest catalyst for a downside in risk assets next week.

2. Sudden Changes in Middle East Geopolitical Situation (Black Swan Risk)

Escalating US-Iran conflict and shipping disruptions:

→ Oil prices surge, inflation expectations reignite, forcing central banks to maintain tightening; Stock market risk appetite declines rapidly;

Positive for crude oil and gold; Negative for global stock indices.

3. Unexpected Divergence at the OPEC+ Meeting

If production is refused to increase, oil prices will continue to rise; if production is significantly increased, oil prices will quickly correct, weakening the energy sector.

4. A Series of Corporate Earnings Defaults: The disappointing earnings and guidance of leading US tech stocks triggered a pullback in the Nasdaq, with the risk spreading to global and Asia-Pacific stock markets.

Conclusion:

The core essence of the US macroeconomic landscape in mid-2026 is that geopolitical shocks are disrupting inflation, the inherent resilience of the economy is providing a safety net, and the Federal Reserve is entering a new cautious policy cycle. A stronger-than-expected recovery in employment, coupled with support from both consumption and investment, has ensured a moderate growth base of around 2%. High inflation fluctuations are entirely due to a one-off external shock, with a clear trend of internal cooling.

The Federal Reserve has abandoned its previous loose and inclusive policy approach, reducing its margin for error, but there is no sufficient reason to adjust interest rates this year, locking in the window for rate cuts in 2027.

Overall, geopolitical tensions are the biggest short-term market variable, while the pace of the Federal Reserve's policy, the slope of inflation decline, and the resilience of economic growth will jointly determine the core theme of global asset pricing in the second half of the year.

Artillery fire replaces tweets! Oil, bonds, and gold are pricing in a simultaneous "war spillover," and the market has entered an extreme risk mode.

The Middle East conflict is spreading from the Strait of Hormuz outwards. Attacks on Kuwaiti facilities and the Houthi rebels' simultaneous announcement of a naval blockade against Saudi Arabia have sounded alarm bells for two vital energy arteries in the Red Sea and the Persian Gulf. Bond traders have systematically reduced their sensitivity to Trump's social media posts; the market is no longer pricing in verbal threats, but instead focusing on every real explosion and act of destruction. This article will analyze the latest developments from four perspectives: US Treasuries, foreign exchange, gold, and crude oil, highlighting extreme sentiment and the underlying logic of risk shifts.

Crude Oil: Attacks on Civilian Facilities Cause Risk Premiums to Surge Sharply

Iran's attacks on Kuwaiti power and water treatment plants are seen by the market as a key signal of a serious escalation of the conflict. WTI crude oil quickly surged above $85, completely erasing all earlier losses caused by rumors of reconciliation. The narrative of supply disruptions is no longer limited to tanker attacks in the Strait of Hormuz, but has spread to the core civilian infrastructure of neighboring oil-producing countries. The Houthi threat to blockade the Bab el-Mandeb Strait further tightens Saudi Arabia's alternative route for exporting crude oil via the Red Sea. Traders have begun to actively price in the extreme scenario of "both straits being blocked simultaneously." In this emotional climate, oil prices become sluggish in their response to negative news but exceptionally sensitive to any new physical attacks, with stop-loss orders easily triggering impulsive price movements.

US Treasuries: Ignore Tweets, Focus on Real Firepower

Research from major overseas institutions reveals a significant shift: the impact of Trump's social media posts about the Middle East conflict on US Treasury yields has been steadily diminishing over time, with the market efficiently categorizing them as noise. However, this does not equate to a shift towards complacency in the bond market. The surge in oil prices directly reignited inflation expectations, causing US Treasuries to quickly erase overnight gains. The 10-year yield rebounded to 4.606%, and the spread between 2-year and 10-year yields widened to 39.5 basis points, with the yield curve steepening significantly at an accelerated pace. Behind this lies the market's repricing of the risk of energy cost transmission to core inflation, and the possibility that the Federal Reserve may be forced to maintain tightening or even restart interest rate hikes. Compared to the verbal battles on social media, traders are more closely monitoring real damage reports from power plants, desalination plants, and oil tankers—these are the core variables reshaping interest rate expectations.

Gold: Safe-Haven Aura Squeezed by Strong Dollar and Hawkish Expectations

Geopolitical turmoil has failed to propel gold into a sustained bull market, with prices fluctuating wildly above $4,000. While Iran's attacks on civilian infrastructure should have strongly catalyzed safe-haven buying, inflationary concerns fueled by oil prices are pushing up the dollar and supporting higher long-term real interest rates, significantly offsetting gold's appeal. The current market exhibits a classic tug-of-war between "war premium" and "hawkish central bank expectations." Trader sentiment is highly divided: one side bets that the unchecked escalation of the conflict will trigger panic buying, while the other believes that the persistently high-interest-rate environment will continue to suppress non-interest-bearing assets. This keeps gold volatility high and significantly increases the difficulty of directional positioning.

US Dollar: Dual Role Supports Passive Strengthening

The US dollar is simultaneously playing the roles of a safe-haven asset and an inflation hedge. The US-Iran conflict is spilling over into surrounding regions, fueling global risk aversion and leading to a habitual inflow of funds into the US dollar. Simultaneously, rising energy prices have reinforced market speculation that the Federal Reserve will maintain a tight stance, providing additional support for the dollar's interest rate advantage and keeping it moderately strong against most currencies. However, this logic is fragile—if the conflict continues to significantly drive up domestic gasoline prices in the US and erode consumer spending, the dollar's safe-haven premium may give way to concerns about stagflation damage. Currently, external turmoil temporarily grants the dollar a passive strength, but its resilience is highly dependent on whether subsequent economic data shows a deterioration in endogenous growth.

Conclusion:

In the short term, oil prices will remain highly sensitive and asymmetric to geopolitical news. Any further attacks on civilian infrastructure could push Brent crude to higher levels, while ceasefire rumors will only trigger a brief sharp drop, with bullish sentiment dominating. Long-term US Treasury yields still face upward risks, and the steepening yield curve trading trend is expected to continue. Gold is expected to continue exhibiting high volatility in both directions, with safe-haven impulses and interest rate suppression alternating to dominate short-term movements, making it difficult to form a stable trend. The US dollar is likely to maintain a relatively strong consolidation, but discussions about the risk of stagflation in the US will limit its upward slope.

Why has the oil market already priced in the risk premium even though the Houthi blockade has not yet been implemented?

Last week, Brent crude and WTI crude rose to around $90 and $85 per barrel, respectively. The core variable driving the market has shifted from the obstruction of a single strait to the potential simultaneous pressure on both the Red Sea and the Persian Gulf shipping routes. Saudi Arabia previously relied on east-west pipelines to transport crude oil from its eastern production areas to Yanbu port, effectively buffering the impact of shipping restrictions in the Strait of Hormuz. However, the Houthi announcement of a maritime blockade against Saudi ports has caused the risk premium for this alternative route to rise rapidly.

Yanbu exports hit a record high, and alternative routes are nearing full capacity.

In the week ending July 17, Saudi Arabia's Red Sea ports saw a record 5.9 million barrels per day of crude oil exports; the seven-day average ending July 20 fell back to 5.5 million barrels per day. The relevant statistics include crude oil shipped to refineries in Jizan and power generation facilities along the Red Sea coast, so not all of it enters the international market. However, this scale still indicates that the Red Sea system handles most of Saudi Arabia's marginal outbound shipments.

For the crude oil market, record export volumes are both a signal of stable supply and a signal of concentrated risk. The higher the loading volume at Yanbu port, the greater the marginal importance of the Bab el-Mandeb Strait to Saudi exports. If security checks, insurance restrictions, or shipowner hedging lead to extended loading cycles, even if the port does not completely cease operations, it could tighten spot supply through mismatched shipping schedules and floating storage.

The effectiveness of the blockade hinges not on the statement but on the actions of shipowners.

Currently, oil tankers are still en route to Saudi Red Sea ports, and some Asian buyers continue to send ships to pick up cargo, indicating that the so-called blockade has not yet translated into an actual closure of shipping lanes. Saudi-led forces have announced measures to protect vessel passage through the Bab el-Mandeb Strait, thus the market is not pricing based on a complete supply disruption scenario.

However, shipping risks do not require a physical blockade to affect oil prices. Factors such as shipowners' acceptance of voyages, insurance companies' increases in surcharges, crew members' willingness to enter high-risk waters, and extended port berthing times all alter effective shipping capacity. If large oil tankers reroute to the southern tip of Africa, transport distance, fuel costs, and vessel occupancy time will all increase simultaneously, reducing the number of voyages that can be completed per unit of time. Forward freight rates and crude oil spreads may react before export volumes.

This is also a key point of contention in the current market. Spot market participants are focused on whether actual shipments decrease, while futures funds are already factoring in tail risks. Some institutions have suggested that under the extreme pressure scenario of a sustained disruption to Red Sea traffic, oil prices may retest $115 to $120 per barrel, but this calculation relies on the blockade being implemented in the long term and does not represent the baseline scenario.

Supply shocks will spread through refinery margins and inflation expectations.

The unique aspect of this event is that the Red Sea is not a supplementary channel to the traditional export system, but rather plays a core diversionary role after the Strait of Hormuz's passage was restricted. If both key waterways are disrupted simultaneously, the market's available transportation alternatives will significantly decrease, and supply risks will shift from production issues to logistical problems.

Continuing crude oil production does not guarantee on-time delivery. Lengther transportation cycles will increase maritime inventories, compress the immediate feedstock available to refineries, and increase the time value of procurement. When light crude oil supply is tight, European and Asian refineries may raise prices for alternative feedstocks, and gasoline, jet fuel, and middle distillate crack spreads may widen accordingly. Therefore, subsequent pricing focus will shift from political statements to four sets of high-frequency indicators: actual loading volumes at Yanbu Port, vessel traffic through the Bab el-Mandeb Strait, changes in war risk surcharges, and the Brent near-month spread.

Conclusion:

In summary, the US-Iran peace talks, along with the US threats and diplomatic maneuvering, have in the short term limited the unchecked upward surge in oil prices caused by panic. However, the actual obstacles to passage through the Red Sea and the Strait of Hormuz, the significant increase in logistics costs, and the expectation of a substantial tightening of supply have provided extremely solid support for oil prices.

For traders, until the maritime logistics chain truly recovers and geopolitical blockades are completely lifted, any short-term pullbacks triggered by diplomatic benefits are more likely to be seen by bullish forces in the physical market as bargain hunting rather than a signal of a trend reversal.

Gold remains a safe-haven asset for global financial institutions, and its strategic value continues to rise.

The recent pullback in gold prices is essentially a superficial phenomenon caused by the strengthening of the US dollar; the intrinsic value of gold itself has not changed. The Trump administration's shift in its currency rhetoric and the policy orientation of the new Federal Reserve Chairman have jointly driven the dollar's rebound, thereby putting pressure on gold prices. However, multiple risks remain, including geopolitical conflicts, high global debt, and potential currency crises in major economies. Gold's role as an "insurance asset" against financial risks remains unchanged. In the long term, signs such as continued gold purchases by central banks indicate that gold's importance in the international monetary system may continue to rise.

The decline in gold prices is merely a symptom; gold's value possesses enduring attributes.

Since the end of January, spot gold prices surged to nearly $5,600 per ounce before experiencing a significant pullback. The market is generally bearish on gold. For thousands of years, gold has stably maintained its real purchasing power, acting as a natural benchmark for measuring currency value. Gold price fluctuations reflect changes in currency purchasing power, not a depreciation of gold itself. Currently, the US dollar is not only stronger relative to gold but also stronger against a basket of currencies. Therefore, this round of gold price adjustments is a result of the dollar's performance.

The strengthening of the US dollar stems from two key factors. After gold prices broke through $5,000 in January, the Trump administration no longer advocated for actively devaluing the dollar to reduce the trade deficit. At the same time, Federal Reserve Chairman Kevin Warsh preferred to combat inflation by stabilizing the currency rather than suppressing the economy, further supporting the dollar's exchange rate. The continued rise in US Treasury yields is driven by supply and demand. The massive issuance of US bonds to fill the fiscal deficit and replace maturing debt has pushed up both short- and long-term interest rates.

Multiple risks are brewing, and the potential for a global currency crisis cannot be ignored.

Market warnings caution against excessive optimism regarding the current dollar rebound. Compared to 2022, the dollar's purchasing power has significantly decreased. Gold prices are still up 20% from last summer, suggesting this dollar strengthening is more of a bear market rally. The Iranian conflict could potentially push up energy prices again, forcing hawks within the Federal Reserve to call for interest rate hikes, and policy uncertainty will impact the bond market.

Furthermore, the international monetary system harbors hidden risks. Japan's national debt burden is heavy, with financial institutions holding large amounts of low-interest government bonds, putting pressure on asset devaluation. If the new British Prime Minister implements aggressive policies, the pound may come under pressure, weakening the UK government's ability to issue bonds. Historically, the strong dollar in the mid-1980s led the US to guide the exchange rate downwards, indirectly triggering the 1987 stock market crash; various chain risks warrant vigilance.

Supporting the Long-Term Logic of Gold: Multiple Signals of a Return to the Gold Standard

Within the framework of investment institutions, gold is not a speculative investment, but a safe haven against financial turmoil, and continued allocation is recommended. He is optimistic about gold's rising status in the global financial system and predicts that the world is moving towards a new gold standard system. During the 180 years the US implemented the gold standard, inflation was controlled, achieving long-term prosperity; after abandoning the gold standard, economic growth slowed significantly, but the gold standard concept remains highly questioned by academia.

In reality, multiple supporting signals have emerged. Central banks in major Asian countries, India, Russia, Poland, and others have continued to increase their gold holdings to record levels, essentially reflecting concerns about the long-term credibility of the US dollar. In the context of ever-expanding global public and private debt, debt bubbles will eventually lead to intractable financial crises, and gold's hedging value will continue to stand out.

Conclusion

In summary, the short-term strengthening of the US dollar puts direct pressure on gold prices, but this is a cyclical fluctuation at the monetary level and cannot shake the long-term value foundation of gold. Middle East geopolitical conflicts, the massive supply of US Treasury bonds, and potential volatility in the Japanese yen and British pound collectively constitute sources of risk in the global financial market. Central banks worldwide continue to hoard gold, and the market seeks alternative assets to fiat currencies, continuously elevating gold's strategic importance.

Short-term market fluctuations should not be viewed with excessive pessimism. Against the backdrop of continued global debt expansion and monetary system uncertainty, gold's long-term allocation logic as a risk protection for asset portfolios remains valid.

Bessenter Reveals Important Details; Dollar's Volatile Rebound May Signal a Turning Point

Recently, the US dollar has exhibited a sustained volatile rebound with a slightly stronger bias. The market has been repeatedly oscillating between Middle East geopolitical risks and positive signals of cooling US inflation, with attention focused on potential turning points from the dollar.

The possibility of US-Iran negotiations is increasing. Firstly, the US Department of Defense recently held a meeting to develop more detailed plans for subsequent military operations. Secondly, US Treasury Secretary Bessenter released significant details about the US-Iran relationship, stating that he has seen a significant decrease in Iranian oil purchases and is tracking Ayatollah's assets, hoping to reveal addresses. Investigating the economic sources of Iran's top officials could potentially shake Iran's motivation to continue its military operations.

The ongoing Middle East geopolitical tug-of-war constrains the dollar's unilateral movement.

The Middle East geopolitical situation is one of the core variables influencing the short-term trend of the US dollar. The US military has launched military strikes against Iran for ten consecutive nights, escalating regional tensions. According to conventional market logic, heightened geopolitical conflict often generates safe-haven demand, benefiting traditional safe-haven assets like the US dollar.

However, ongoing diplomatic efforts have offset some of the safe-haven benefits. Iranian officials have confirmed receiving a ten-day ceasefire proposal from mediators, significantly increasing uncertainty about the future of the conflict and making it difficult for the market to form a unified trading expectation. As a result, the US dollar has entered a period of consolidation, with investors generally remaining cautious and unwilling to establish large-scale one-sided trading positions.

Currently, the combination of economic sanctions and military threats may have a greater impact, potentially ending the conflict sooner.

The intertwining of inflation and interest rate hike expectations provides a floor for the US dollar.

US inflation data and expectations of a Federal Reserve interest rate hike are key factors limiting the upside potential of the US dollar. Previously released US inflation data showed a moderate trend, effectively cooling aggressive market bets on interest rate hikes and weakening the dollar's upward momentum. However, the global inflation outlook remains uncertain, with key variables focusing on the progress of shipping in the Strait of Hormuz and the stabilization of the international oil market.

Market consensus remains strong, with traders generally believing the Federal Reserve will raise interest rates at least once more this year, providing a floor for the US dollar. Volatility in the oil market has further exacerbated market uncertainty, with significant energy price fluctuations continuing to impact global inflation and the dollar's trajectory.

Conclusion:

The temporary safe-haven buying stemming from the US-Iran geopolitical conflict, concerns about "double-dip inflation" triggered by the Strait of Hormuz and soaring oil prices (over 20% monthly increase), coupled with the Fed's stance of at least one rate hike this year, have built a floor for the US dollar.

Moderate US inflation data has cooled aggressive bets on rate hikes. Combined with diplomatic efforts to reach a ten-day ceasefire in the Middle East and the prospect of new US economic sanctions, this has offset some of the safe-haven premium, limiting bullish sentiment and leading to more cautious market positioning.

Meanwhile, soaring energy prices have severely worsened Japan's terms of trade, uncertainty surrounding the UK government's fiscal policy, and the upcoming ECB decision have weakened the euro's rebound, indirectly consolidating the dollar's relative strength.

Overview of Key Overseas Economic Events and Matters This Week:

Monday (July 20): UK July CBI Retail Sales Expectations Index; US June Durable Goods Orders (Preliminary, MoM); US June Wholesale Inventories (Preliminary, MoM);

Tuesday (July 21): US June Wholesale Inventories (Preliminary, MoM); US July Conference Board Consumer Confidence Index; Speech by RBA Governor Bullock

Wednesday (July 22): Australia Q2 Consumer Price Index (YoY); US Weekly EIA Crude Oil Inventory Change (in thousands of barrels); UK Unadjusted Input PPI MoM (%) (Month-on-Month) (June); US Weekly EIA Crude Oil Inventory Change (barrels);

Thursday (July 23): Federal Reserve FOMC Interest Rate Decision; Australia Q2 Export Price Index (YoY); Eurozone Q2 GDP (Preliminary, YoY); Eurozone July Consumer Confidence Index (Final); Bank of England Interest Rate Decision, Meeting Minutes, and Monetary Policy Report; US Q2 GDP (Preliminary) - Annualized QoQ; US Initial Jobless Claims (Seasonally Adjusted) - Last Week; US Q2 Personal Consumption Expenditures Price Index (Preliminary) - Annualized QoQ; Federal Reserve Chairman Warsh Holds Monetary Policy Press Conference; Bank of England Governor Bailey Holds Monetary Policy Press Conference

Friday (July 24): Bank of Japan Announces Interest Rate Decision and Economic Outlook Report; Japan's June Unemployment Rate; Japan's June Retail Sales (Monthly) - Seasonally Adjusted; Australia's Q2 Producer Price Index (Yearly); Eurozone July Consumer Price Index (Preliminary) - Monthly; US July University of Michigan Consumer Sentiment Index (Final); Bank of Japan Governor Ueda Kazuo Holds Monetary Policy Press Conference

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