{"id":88812,"date":"2026-08-07T17:51:15","date_gmt":"2026-08-07T07:51:15","guid":{"rendered":"https:\/\/ic.com\/blog\/?p=88812"},"modified":"2026-08-07T17:51:16","modified_gmt":"2026-08-07T07:51:16","slug":"ic-asia-fundamental-forecast-07-august-2026","status":"publish","type":"post","link":"https:\/\/ic.com\/blog\/ic-asia-fundamental-forecast-07-august-2026\/","title":{"rendered":"IC &#8211; Asia Fundamental Forecast | 07 August 2026"},"content":{"rendered":"\n<p><strong>IC &#8211; Asia Fundamental Forecast | 07 August 2026<\/strong><\/p>\n\n\n\n<p><strong>What happened in the U.S. session?<\/strong><strong><br \/><\/strong><strong><br \/><\/strong>Stronger-than-expected productivity and still-low jobless claims suggested the U.S. labor market remains healthy, but the earlier weak ADP employment report kept investors focused on Friday&#8217;s official payrolls release as the week&#8217;s decisive macro event. Treasury yields edged higher, the dollar was little changed overall, equities traded mixed with technology lagging, gold extended its rally, and oil remained driven by Middle East geopolitical developments rather than economic data.<br \/><br \/><strong>What does it mean for the Asia Session?<\/strong><br \/><br \/>Asian traders should focus on the U.S. Non-Farm Payrolls, Unemployment Rate, and Average Hourly Earnings, along with Canada&#8217;s employment data, as these are expected to be the day&#8217;s biggest market-moving events. The results are likely to drive volatility in the U.S. dollar, Canadian dollar, gold, Treasury yields, and major forex pairs. A stronger-than-expected U.S. jobs report would likely support the dollar and weigh on gold and risk-sensitive assets, while a weaker report could weaken the dollar and boost gold and broader market sentiment.<br \/>\u200b<br \/><strong>The Dollar Index (DXY)<\/strong><\/p>\n\n\n\n<p><strong>Key news events today<\/strong><\/p>\n\n\n\n<p>Non-Farm Employment Change (12:30 pm GMT)<br \/><br \/>Average Hourly Earnings m\/m (12:30 pm GMT)<br \/><br \/>Non-Farm Employment Change (12:30 pm GMT)<br \/><br \/>Unemployment Rate (12:30 pm GMT)<br \/><br \/><strong>What can we expect from DXY today?<\/strong><strong><br \/><\/strong><strong><br \/><\/strong>The U.S. dollar is trading with a slightly bullish bias ahead of Friday&#8217;s U.S. jobs report. Although geopolitical risks have eased somewhat, the market&#8217;s focus is firmly on Non-Farm Payrolls, which could determine the Federal Reserve&#8217;s next policy direction. Strong employment data would likely strengthen the dollar across the board, while weaker figures could trigger renewed selling pressure as investors reassess the outlook for U.S. interest rates.<\/p>\n\n\n\n<p><br \/><strong>Central Bank Notes:<\/strong><\/p>\n\n\n\n<ul>\n<li>The Federal Open Market Committee (FOMC) kept the federal funds rate unchanged at 3.50%\u20133.75% at its July 28\u201329, 2026, meeting, marking the fifth consecutive meeting without a policy change. The Committee voted 9\u20133 to maintain rates, with three members dissenting in favor of a 25-basis-point rate hike, highlighting growing concern among some policymakers that inflation remains too high.<\/li>\n\n\n\n<li>The Committee reaffirmed its dual mandate of maximum employment and price stability. Officials noted that the labor market remains resilient, with job gains broadly keeping pace with labor force growth and the unemployment rate remaining relatively stable. The FOMC continues to view employment conditions as consistent with a healthy economy while remaining vigilant for signs of labor market weakening.<\/li>\n\n\n\n<li>Inflation remains the Committee&#8217;s primary concern. While some recent inflation data have shown moderation, overall price pressures remain above the Fed&#8217;s 2% target. Policymakers emphasized that elevated inflation continues to be driven in part by higher energy prices and persistent supply-side pressures, leading the Committee to maintain a restrictive monetary policy stance.<\/li>\n\n\n\n<li>Economic activity continues to expand at a solid pace despite elevated uncertainty. Strong productivity growth, business investment, and continued spending related to artificial intelligence remain supportive of economic growth. However, the FOMC acknowledged that geopolitical tensions, particularly developments affecting global energy markets, continue to pose risks to both inflation and the broader economic outlook.<\/li>\n\n\n\n<li>The July meeting highlighted increasing divisions within the Committee. Three policymakers\u2014Beth Hammack, Neel Kashkari, and Lorie Logan\u2014voted against the majority, preferring an immediate rate increase. This unusually large number of dissents reflects growing concern among some officials that inflation could remain persistent and may require additional policy tightening if progress stalls.<\/li>\n\n\n\n<li>Chair Kevin Warsh reiterated that future policy decisions will remain strictly data-dependent. He avoided providing explicit forward guidance, emphasizing that upcoming decisions will depend on incoming inflation, employment, and growth data. Warsh also stressed that the Committee remains fully committed to returning inflation to its 2% objective and is prepared to act if inflationary pressures intensify.<\/li>\n\n\n\n<li>The FOMC continues its balance sheet normalization program without changes. The Federal Reserve will maintain Treasury runoff caps at $5 billion per month and agency mortgage-backed securities (MBS) runoff caps at $35 billion per month, while continuing to ensure ample reserves remain available within the banking system.<\/li>\n\n\n\n<li>The next meeting is scheduled for 15 to 16 September 2026.<\/li>\n<\/ul>\n\n\n\n<p><strong>Next 24 Hours Bias<\/strong><\/p>\n\n\n\n<p>Weak Bullish<\/p>\n\n\n\n<p><strong>Gold (XAU)<\/strong><\/p>\n\n\n\n<p><strong>Key news events today<\/strong><br \/><br \/>Non-Farm Employment Change (12:30 pm GMT)<\/p>\n\n\n\n<p>Average Hourly Earnings m\/m (12:30 pm GMT)<\/p>\n\n\n\n<p>Non-Farm Employment Change (12:30 pm GMT)<\/p>\n\n\n\n<p>Unemployment Rate (12:30 pm GMT)<\/p>\n\n\n\n<p><strong>What can we expect from Gold today?<\/strong><\/p>\n\n\n\n<p><a href=\"https:\/\/www.tradingview.com\/symbols\/XAUUSD\/?exchange=ICMARKETS\" title=\"\">Gold<\/a> remains fundamentally supported by a softer U.S. dollar, easing bond yields, and ongoing geopolitical uncertainty, but today&#8217;s U.S. Non-Farm Payrolls report is expected to be the week&#8217;s biggest market catalyst. A weaker jobs report would likely strengthen gold by reinforcing expectations that the Federal Reserve will pause further tightening, while a stronger-than-expected report could lift the dollar and Treasury yields, weighing on the precious metal.<br \/><br \/><strong>Next 24 Hours Bias<\/strong><br \/>Medium Bearish<\/p>\n\n\n\n<p><strong>The Australian Dollar (AUD)<\/strong><\/p>\n\n\n\n<p><strong>Key news events today<\/strong><\/p>\n\n\n\n<p>No major news event<\/p>\n\n\n\n<p><strong>What can we expect from AUD today?<\/strong><\/p>\n\n\n\n<p>The Australian dollar enters Friday on a relatively firm footing, supported by the Reserve Bank of Australia&#8217;s tighter policy stance and improving global risk sentiment. However, traders are becoming more cautious ahead of the U.S. Non-Farm Payrolls report, which is expected to be the day&#8217;s biggest market-moving event. A stronger-than-expected U.S. jobs report could boost the U.S. dollar and pressure the AUD, while weaker data would likely support further gains in the Australian dollar.<br \/><br \/><strong>Central Bank Notes:<\/strong><\/p>\n\n\n\n<ul>\n<li>The Reserve Bank of Australia (RBA) maintained the Cash Rate Target at 4.35% during its August 2026 Monetary Policy Meeting, continuing its cautious approach after three rate increases earlier in the year. Policymakers judged that the current restrictive policy setting was appropriate while assessing the full impact of previous tightening on inflation, household demand, and economic activity.<\/li>\n\n\n\n<li>Inflation remained the primary focus for the Board, with recent data showing signs of moderation as energy prices eased following the partial reopening of the Strait of Hormuz. However, the RBA emphasized that underlying inflation pressures, particularly in services, wages, and domestic cost growth, remain above levels consistent with the 2\u20133% inflation target. The Bank maintained that policy must remain restrictive until there is stronger evidence that inflation is sustainably moving lower.<\/li>\n\n\n\n<li>The RBA acknowledged that headline inflation has improved from earlier peaks due to lower fuel costs and easing global supply pressures. However, policymakers noted that inflation risks remain tilted to the upside due to geopolitical uncertainty, potential energy market disruptions, and the possibility that businesses may continue passing higher costs through to consumers.<\/li>\n\n\n\n<li>Economic growth showed signs of slowing during mid-2026 as higher interest rates continued to weigh on household consumption and borrowing activity. Nevertheless, the RBA expects economic momentum to gradually improve in the second half of the year, supported by easing inflation, improving real household income, and stronger business confidence.<\/li>\n\n\n\n<li>The labour market remained relatively resilient, but policymakers highlighted that employment growth has moderated compared with earlier in the year. The Board continued monitoring wage growth, unemployment trends, and labour market slack, noting that a sharper deterioration in employment conditions could influence future policy decisions.<\/li>\n\n\n\n<li>External conditions remained uncertain, with global energy market volatility, weaker Chinese demand, and geopolitical tensions creating a mixed outlook for Australia&#8217;s growth and inflation environment. Softer commodity demand from China continued to weigh on Australia&#8217;s export outlook, while commodity price fluctuations remained a key risk factor.<\/li>\n\n\n\n<li>Financial markets continued to price the RBA as being near the end of its tightening cycle, with investors increasingly expecting rates to remain unchanged through the third quarter of 2026. However, markets maintained some probability of another rate increase if inflation proves more persistent than expected, particularly through services inflation and wage pressures.<\/li>\n\n\n\n<li>The August statement reinforced the RBA\u2019s \u201cdata-dependent and patient\u201d approach, with policymakers avoiding any commitment toward rate cuts while maintaining flexibility to respond to incoming inflation, employment, and economic growth data. The Board emphasized that future decisions will depend on inflation expectations, household spending behaviour, business pricing decisions, and global economic developments.<\/li>\n\n\n\n<li>The next meeting is on 10 to 11 August 2026.<\/li>\n<\/ul>\n\n\n\n<p><strong>Next 24 Hours Bias<\/strong><\/p>\n\n\n\n<p>Weak Bullish<\/p>\n\n\n\n<p><strong>The Kiwi Dollar (NZD)<\/strong><\/p>\n\n\n\n<p><strong>Key news events today<\/strong><br \/><br \/>No major news event<\/p>\n\n\n\n<p><strong>What can we expect from NZD today?<\/strong><\/p>\n\n\n\n<p>The New Zealand Dollar is trading with a slightly bearish bias heading into Friday&#8217;s session. Softer domestic labour market data has strengthened expectations of a more dovish RBNZ, while persistent US Dollar strength continues to pressure NZD\/USD. Although improving global risk appetite has helped limit losses, the Kiwi&#8217;s near-term direction will largely depend on upcoming US economic data, developments in China, and any further shifts in RBNZ interest rate expectations.<br \/><br \/><strong>Central Bank Notes:<\/strong><\/p>\n\n\n\n<ul>\n<li>The Reserve Bank of New Zealand&#8217;s Monetary Policy Committee (MPC) raised the Official Cash Rate (OCR) by 25 basis points to 2.50% at its 8 July 2026 Monetary Policy Review, marking the first rate increase of the current tightening cycle. Unlike the split decision in May, the Committee reached a consensus that reducing monetary stimulus was appropriate to return inflation to target.<\/li>\n\n\n\n<li>Although global oil prices have fallen following the partial reopening of the Strait of Hormuz, the RBNZ warned that inflation remains above its 1\u20133% target range and that lingering energy-related cost pressures continue to pose upside risks. The Bank reiterated that further OCR increases are likely, although the timing will remain dependent on incoming economic data.<\/li>\n\n\n\n<li>The RBNZ now expects headline inflation to have peaked at 3.9% in Q2 2026, lower than the 4.3% peak projected in May, reflecting weaker oil prices. Inflation is forecast to ease to around 3.3% in Q3 2026 before gradually returning to the 2% midpoint by mid-2027, while underlying domestic inflation remains persistent.<\/li>\n\n\n\n<li>The Committee judged that the current OCR remains accommodative, even after the July increase, and stated that additional tightening will probably be required over coming meetings. Policymakers emphasized that future decisions will depend on inflation expectations, firms&#8217; pricing behaviour, labour market conditions, and the pace of economic recovery rather than following a predetermined path.<\/li>\n\n\n\n<li>Economic activity slowed during the June quarter as higher energy costs temporarily weighed on demand, but the RBNZ expects the recovery to resume in the September quarter. The Bank&#8217;s Kiwi-GDP nowcasting model projects 0.6% quarterly GDP growth in Q3 2026, supported by improving business confidence, lower fuel prices, and stronger household purchasing power as inflation moderates.<\/li>\n\n\n\n<li>Domestic demand remains uneven, with tourism, agriculture, and export industries continuing to outperform, while discretionary retail spending, construction, and housing activity remain subdued. The RBNZ believes spare capacity in the economy should limit widespread pass-through of higher business costs into consumer prices, although this remains an important upside inflation risk.<\/li>\n\n\n\n<li>Financial conditions have eased since the May meeting as wholesale interest rates declined, and the New Zealand dollar depreciated, helping exporters but potentially adding to imported inflation. The Committee noted that shorter-term mortgage rates had increased earlier in the year, while longer-term borrowing costs have begun to stabilize alongside lower market interest-rate expectations.<\/li>\n\n\n\n<li>The MPC concluded that maintaining price stability remains its primary objective, stressing that while further rate increases are expected, policy will remain data-dependent. The Committee believes returning inflation to the 2% midpoint is essential to achieving a sustainable recovery in employment, household incomes, and long-term economic growth.<\/li>\n\n\n\n<li>The next meeting is on 2 September 2026.<\/li>\n<\/ul>\n\n\n\n<p><strong>Next 24 Hours Bias<\/strong><\/p>\n\n\n\n<p>Weak Bullish<\/p>\n\n\n\n<p><strong>The Japanese Yen (JPY)<\/strong><strong><br \/><\/strong><strong><br \/><\/strong><strong>Key news events today<\/strong><\/p>\n\n\n\n<p>No major news event<\/p>\n\n\n\n<p><strong>What can we expect from JPY today?<br \/><br \/><\/strong>The Japanese <a href=\"https:\/\/www.tradingview.com\/symbols\/USDJPY\/?exchange=ICMARKETS\" title=\"\">yen <\/a>enters Friday&#8217;s trading session on a firmer footing following last week&#8217;s unprecedented U.S.-Japan currency intervention, but near-term direction is likely to be driven by the U.S. Non-Farm Payrolls report. While intervention has reduced speculative pressure against the yen, markets believe lasting appreciation will depend on additional Bank of Japan policy tightening. A strong U.S. jobs report could lift the dollar and pressure the yen, whereas weaker employment data would likely support further JPY strength by reinforcing expectations of easier Federal Reserve policy.<\/p>\n\n\n\n<p><br \/><strong>Central Bank Notes:<\/strong><\/p>\n\n\n\n<ul>\n<li>The Bank of Japan (BOJ) maintained the short-term policy rate at 1.00% at its 30\u201331 July 2026 Monetary Policy Meeting. The decision reflected confidence that Japan&#8217;s economy continues to recover moderately, while policymakers judged that further tightening should proceed gradually as they assess incoming data and the sustainability of inflation.<\/li>\n\n\n\n<li>The BOJ continues to guide the uncollateralized overnight call rate at around 1.00%, emphasizing that future policy adjustments will remain data-dependent. The Bank reiterated that any additional rate increases will depend on sustained wage growth, inflation remaining durably around or above the 2% target, stable financial markets, and resilient domestic demand rather than following a predetermined path.<\/li>\n\n\n\n<li>The Bank will continue reducing its purchases of Japanese Government Bonds (JGBs) in line with its previously announced tapering plan while maintaining flexibility to conduct market operations if excessive volatility threatens financial stability. Policymakers also remain attentive to sharp movements in the yen and their potential impact on inflation and financial conditions.<\/li>\n\n\n\n<li>Japan&#8217;s economy continues to expand at a moderate pace, supported by firm domestic consumption, strong corporate investment, improving labor market conditions, and recovering global demand. However, uncertainty surrounding global trade, geopolitical developments, and external manufacturing activity continues to pose downside risks to the growth outlook.<\/li>\n\n\n\n<li>Underlying inflation continues to strengthen. While headline inflation has moderated somewhat due to easing energy prices, core inflation remains above the BOJ&#8217;s 2% objective, supported by broad-based services inflation, rising labor costs, and stronger pricing behavior among firms. The BOJ now sees upside risks to medium-term inflation from persistent wage growth and structural price-setting changes.<\/li>\n\n\n\n<li>Domestic inflationary pressures remain supported by robust wage settlements, persistent labor shortages, and continued pass-through of higher labor costs into services prices. At the same time, policymakers are closely monitoring the effects of yen depreciation, which could accelerate imported inflation if sustained, even as lower commodity and energy prices provide some offset.<\/li>\n\n\n\n<li>The BOJ expects real GDP growth to remain moderate over the near term as accommodative financial conditions, rising household incomes, and business investment continue to support activity. Nevertheless, policymakers acknowledge that tighter global financial conditions, weaker external demand, and geopolitical uncertainty could temporarily restrain growth.<\/li>\n\n\n\n<li>Looking ahead, the BOJ maintains that if inflation continues to stabilize around its 2% objective alongside sustained wage gains and economic expansion, further gradual policy normalization remains appropriate. Financial markets generally expect another 25-basis-point rate increase later in 2026, although the timing will depend on incoming economic and inflation data.<\/li>\n\n\n\n<li>The next meeting is on 17 to 18 September 2026.<\/li>\n<\/ul>\n\n\n\n<p><strong>Next 24 Hours Bias<\/strong><\/p>\n\n\n\n<p>Medium Bearish<\/p>\n\n\n\n<p><strong>Oil<\/strong><\/p>\n\n\n\n<p><strong>Key news events today<\/strong><br \/><br \/>No major news event<\/p>\n\n\n\n<p><strong>What can we expect from Oil today?<\/strong><\/p>\n\n\n\n<p>Crude oil remains highly sensitive to geopolitical developments heading into Friday&#8217;s trading session after a sharp rally on Thursday. The biggest driver is renewed tension surrounding the Strait of Hormuz, where Iran is reviewing legislation that could restrict U.S. and Israeli vessels from using the vital shipping route. Since roughly one-fifth of global oil supplies pass through the strait, traders have quickly priced in a higher geopolitical risk premium, pushing Brent and WTI significantly higher.<br \/><br \/><strong>Next 24 Hours Bias<\/strong><strong><br \/><\/strong>Medium Bullish<\/p>\n\n\n\n<p><strong>Risk Warning:<\/strong>&nbsp;Trading in securities involves significant risk. Prices may fluctuate and securities can become entirely valueless. You may incur losses that exceed your potential profits, and in some cases, losses may exceed the amount you have deposited. Securities, futures, options, and contracts for differences are complex financial instruments and are not suitable for all investors. Engaging in such transactions requires a sound understanding of the associated risks. Please read and ensure you fully understand our&nbsp;<a href=\"https:\/\/cdn.ic.com\/uploads\/FSA\/Risk_Disclosure_Notice_FSA.pdf\" target=\"_blank\" rel=\"noreferrer noopener\">Risk Disclosure<\/a>.<\/p>\n\n\n\n<p>Our leverage is dynamic and may change at any time. Such changes may affect your positions and margin requirements. You are responsible for monitoring your positions and maintaining sufficient margin at all times<\/p>\n","protected":false},"excerpt":{"rendered":"<p>IC &#8211; Asia Fundamental Forecast | 07 August 2026 What happened [&hellip;]<\/p>\n","protected":false},"author":8,"featured_media":84953,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[196,215,339],"tags":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/ic.com\/blog\/wp-json\/wp\/v2\/posts\/88812"}],"collection":[{"href":"https:\/\/ic.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ic.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ic.com\/blog\/wp-json\/wp\/v2\/users\/8"}],"replies":[{"embeddable":true,"href":"https:\/\/ic.com\/blog\/wp-json\/wp\/v2\/comments?post=88812"}],"version-history":[{"count":2,"href":"https:\/\/ic.com\/blog\/wp-json\/wp\/v2\/posts\/88812\/revisions"}],"predecessor-version":[{"id":88846,"href":"https:\/\/ic.com\/blog\/wp-json\/wp\/v2\/posts\/88812\/revisions\/88846"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/ic.com\/blog\/wp-json\/wp\/v2\/media\/84953"}],"wp:attachment":[{"href":"https:\/\/ic.com\/blog\/wp-json\/wp\/v2\/media?parent=88812"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ic.com\/blog\/wp-json\/wp\/v2\/categories?post=88812"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ic.com\/blog\/wp-json\/wp\/v2\/tags?post=88812"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}