Market Commentary: Tuesday 22nd July

The Australian dollar edged lower against the US dollar following the release of the Reserve Bank of Australia’s meeting minutes. The RBA opted to defer a rate cut, viewing a July move as inconsistent with their ‘cautious’ strategy.

New Zealand’s trade surplus was announced this morning at NZD 142M in June 2025, significantly below the expected forecast of NZD 1,020M, and down from NZD 585M in the same month a year earlier. Exports rose 10% year-over-year, but imports rose at a faster rate of 19%.

The Japanese market had a volatile Tuesday, as investors weighed the policy uncertainty ahead of Sunday’s elections. The Nikkei 225 rose 1% to above 40,200, but reversed in the Asia afternoon session.

The UK made an investment decision to approve the landmark £38 billion Sizewell C nuclear plant, seen by the government as a key development to drive investment and economic growth. Also in the UK, government borrowing came in worse than forecast in June - a surge in debt interest payments sent the budget deficit to £20.7 billion. This level of borrowing leaves Chancellor Rachel Reeves with a hole to fill in her autumn budget.

On the economic calendar today, BoE’s Bailey will testify on financial stability at 10:15 AM, and Fed Chair Powell will speak at 1:30 PM.

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