Fed meeting under watch

Asia-Pacific Markets

Asian equities kicked off the session on solid footing, buoyed by hopes that renewed dialogue between Washington and Beijing could ease trade tensions. Investors welcomed signs that both sides may be softening their stance, which lifted risk sentiment across the region.

However, caution lingered ahead of the Federal Reserve’s upcoming rate decision.

Federal Reserve Outlook

The U.S. central bank begins its two-day policy meeting today, with markets widely anticipating a pause in rate adjustments. Still, the tone of the statement and Chair Powell’s remarks are under scrutiny, especially as policymakers weigh the risk of acting too slowly versus overreacting to tariff-driven inflation. The internal debate is intensifying: Should the Fed prioritize economic momentum and employment, or double down on its credibility in curbing inflation—even if supply-side shocks muddy the waters?

Commodities

Oil Markets
Crude prices clawed back some losses on Tuesday following a brutal multi-session slump. Brent climbed to around $61 a barrel and WTI recovered to near $58 after sinking to their lowest closes since early 2021. The rebound comes despite OPEC+ confirming it will proceed with another round of output increases, citing global supply-demand dynamics.

Gold
Gold prices remained supported for a second consecutive day, even as they pulled back from intraday highs reached during Asian hours. The yellow metal is drawing strength from safe-haven interest amid geopolitical uncertainty, though the recent easing in U.S.-China rhetoric has capped upside momentum. Traders are holding back from aggressive positions ahead of the Fed meeting, where signals on future rate paths could be decisive for bullion’s short-term direction.

Economic Calendar Highlights

Today’s docket includes trade balance figures, offering a snapshot of cross-border activity at a time when tariffs are back in the spotlight. Markets remain sensitive to any data that might tip the scales for central bank policy over the summer.