• Asian stock markets remain cautious as investors digest political tensions and mixed economic signals.

• A temporary ceasefire between Israel and Iran has calmed oil supply concerns, providing slight market relief.

• The MSCI Asia-Pacific index outside Japan was mostly flat, with Tokyo’s Nikkei climbing 0.9% to a four-month high.

• The U.S. dollar weakened sharply after reports emerged that President Trump is considering replacing Fed Chair Jerome Powell by September or October.

• Trump’s ongoing criticism of Powell, accusing him of not cutting rates fast enough, has shaken investor confidence in the Fed’s independence.

• The euro surged, its highest level since November 2021, while the Swiss franc hit a decade high.

• The Japanese yen also strengthened, reflecting investor risk aversion and safe-haven flows.

• The U.S. dollar index is at its lowest level since March 2022, down 10% this year as trade war concerns weigh on sentiment.

• Powell, during congressional testimony, warned that Trump’s tariffs could trigger one-time price spikes, but persistent inflation remains a risk.

• Despite expectations for U.S. rate cuts this year, Fed officials remain cautious given trade uncertainty and inflation risks.

• Oil prices are attempting a modest recovery after a volatile month, with Brent crude at $67.82 and WTI at $65.10 per barrel.

What’s Next?
• While geopolitical tensions like the Israel-Iran ceasefire bring temporary relief, the uncertainty surrounding Fed leadership and trade policy continues to erode investor confidence. Real test will be how markets react as Trump’s tariff deadlines and potential Fed changes approach — volatility looks inevitable.