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Dollar Surges as Inflation Data Fuels Fed Rate Hike Expectations 
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Dollar Gains on Safe-Haven Demand as Iran Tensions and Inflation Data Loom 
US, Japan Reaffirm Strong Currency Coordination Amid Yen Volatility 
Gold Prices Hold Steady as Investors Monitor U.S.-Iran Tensions and Trump-Xi Summit 
Trump Says Iran Ceasefire ‘On Life Support’ as Oil Prices Surge Above $104 
Australia Housing Tax Reform Sparks Debate Over Property Investor Tax Breaks 
Asian Stocks Slip as Korea’s KOSPI Tumbles Amid Iran Conflict and Chip Sector Profit-Taking 
OECD Sees Bank of Japan Raising Interest Rates to 2% by 2027 
US Inflation Expected to Rise Again in April as Fed Signals Higher Interest Rates 
Trump Administration Seeks Court Pause to Reinstate 10% Global Tariffs 
Rubio Discusses Iran Crisis and Strait of Hormuz Disruptions With UK and Australia 
South Korea Central Bank Signals Inflation Concerns as Oil Prices Surge 
Goldman Sachs Delays Fed Rate Cut Forecast to 2026 Amid Rising Inflation Concerns 
Trump Says Iran Ceasefire Near Collapse as Oil Prices Surge 
Asian currencies traded mostly flat on Wednesday after posting strong gains in the previous session, as higher-than-expected U.S. inflation data strengthened the U.S. dollar and pushed Treasury yields higher. Investors also reduced expectations for Federal Reserve interest rate cuts, increasing pressure on regional currencies.
The U.S. Dollar Index remained near a one-week high during Asian trading hours after climbing 0.4% on Tuesday. Market sentiment shifted after fresh data showed U.S. consumer prices rose 3.8% year-over-year in April, marking the fastest pace of inflation since May 2023. The reading came in above analyst forecasts, reinforcing concerns that the Federal Reserve could maintain elevated interest rates for a longer period.
Following the inflation report, traders largely ruled out the possibility of a Fed rate cut in 2026, while expectations for another rate hike increased slightly. Rising Treasury yields also supported the dollar’s strength against major Asian currencies.
The Japanese yen weakened slightly, with the USD/JPY pair rising 0.1% after gaining 0.3% in the previous session. The South Korean won also stabilized after a sharp rally, while the Indian rupee hovered near record lows against the dollar after USD/INR touched 95.7375 in the prior session.
Meanwhile, the Singapore dollar and Australian dollar traded in narrow ranges as investors remained cautious ahead of key geopolitical developments.
The Chinese yuan stayed near a three-year low against the dollar, although it continued to outperform several regional peers. Investors are closely monitoring talks between former U.S. President Donald Trump and Chinese President Xi Jinping in Beijing from May 13 to May 15. Discussions are expected to focus on trade relations, tariffs, artificial intelligence, rare earth exports, and the ongoing Iran conflict.
Global market sentiment also remained fragile due to escalating Middle East tensions. Concerns over disruptions in oil shipments through the Strait of Hormuz kept crude oil prices above $100 per barrel, adding to inflation worries worldwide and further supporting the U.S. dollar.
