Australian Consumer Sentiment Rises to Three-Year High as Rate Cuts Lift Confidence

Economic

Summary:

Australian consumer confidence rebounded strongly in August, with the Westpac-Melbourne Institute index jumping 5.7% to 98.5, its highest since early 2022, as rate cuts improved perceptions of household finances and the economic outlook....

Consumer sentiment and rate cuts

The Westpac-Melbourne Institute survey showed a sharp improvement in consumer sentiment in August, reflecting the positive impact of the Reserve Bank of Australia’s third interest rate cut this year. The benchmark rate now stands at 3.60%, and the central bank signaled willingness to ease further if conditions warrant. This policy shift has a direct causal effect: lower borrowing costs reinforced expectations of cheaper mortgages, boosting household confidence and consumption outlooks.

Confidence strengthened across nearly all categories. Household finances compared with a year ago rose 6.2%, while expectations for the next 12 months gained 5.4%. At the broader economic level, the outlook for the next year improved 7.6% and the five-year view rose 5.4%. These improvements illustrate how monetary policy easing correlates with optimism both at the micro level of household budgets and at the macro level of national economic growth.

Implications for retail spending and housing

The survey highlighted encouraging signs for consumption, with the index measuring whether it was a good time to buy major household items climbing 4.2%. More notably, sentiment toward housing rose significantly, with the measure of whether it was a good time to purchase a dwelling surging 10.5% to 97.8, its highest in four years. However, the figure still lags the long-term average of 120, underscoring affordability constraints that limit the causal link between sentiment and actual demand in the property market.

The August survey suggests that the RBA’s rate cuts are successfully restoring confidence among Australian households, helping sentiment recover to its strongest level in over three years. While optimism is improving, particularly in housing and consumer spending, structural issues such as affordability and long-run income growth remain barriers to a sustained rebound. The results nevertheless indicate that monetary policy easing is beginning to stimulate the desired uplift in consumer psychology.

Source: Reuters

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Samantha Luan

Economic

Forex

The Indian rupee is expected to open little changed on Tuesday, defying the dollar's advance against major peers and Asian currencies, with traders noting the local unit has managed to pause its recent weakening trend.The 1-month non-deliverable forward indicated the rupeewill likely open largely unchanged to the U.S. dollar, from 87.35 on Monday.

The rupee, which came near slipping past its all-time low of 87.95 two weeks ago, has since managed to crawl back up.Support has come from the Reserve Bank of India's resolve to prevent the local currency from touching another record low, unwinding of long dollar positions, and more recently, India's planned tax cuts and cautious optimism around the Ukraine-Russia conflict.

The rupee inched higher last week, posting its first weekly advance in over a month, and inched up 0.2% on Monday.The rupee's slide "has been checked for now" and the "bias is now more neutral", a currency trader at a Mumbai-based bank said."Near term, it should stay in a tight range unless fresh triggers emerge from the U.S. tariff headlines."

DOLLAR CLIMBS

The dollar indexrose on Monday and inched up slightly on Tuesday while Asian currencies dipped. Investors weighed signs of progress toward halting the Russia-Ukraine conflict and awaited Federal Reserve Chair Jerome Powell's speech at Jackson Hole on Friday.Ukrainian President Volodymyr Zelenskiy said security guarantees for his country could be finalised within 10 days following talks with U.S. President Donald Trump and European leaders.

A peace deal between Russia and Ukraine would boost overall risk appetite, a positive for the rupee. It could benefit the currency more directly by reducing the likelihood that the U.S. would proceed with additional tariffs on India for purchases of Russian oil, which are scheduled to take effect on August 27.

Source: TradingView

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Gerik

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Dollar resilience amid geopolitical focus

The dollar index rose 0.31 percent to 98.122, reflecting steady demand for the greenback as geopolitical risks overshadowed markets. The immediate catalyst was the White House summit between US President Donald Trump, Ukrainian President Volodymyr Zelenskiy, and European leaders. Trump pledged that the United States would help guarantee Ukraine’s security in any eventual peace settlement with Russia. This assurance boosted perceptions of US geopolitical influence, which in turn supported the dollar as a safe-haven currency. The causal relationship is clear: heightened global uncertainty increases demand for the dollar as a defensive asset.

Market analysts noted that caution dominates trading behavior. Tina Teng, an independent analyst in Auckland, emphasized that the dollar’s strength coincides with record highs in equity markets, suggesting that risk-on sentiment coexists with safe-haven flows. The euro traded at $1.1667, up a marginal 0.06 percent but still confined to the range it has maintained for the past two weeks. The dollar held at 147.835 yen, close to the upper end of its monthly trading channel, showing a strong correlation between steady US yields and yen weakness.

Attention turning to Federal Reserve guidance

Beyond geopolitics, traders are closely awaiting signals from the Federal Reserve’s Jackson Hole symposium later this week, where Chair Jerome Powell is expected to address the economic outlook and policy framework. With markets already pricing in a high probability of a rate cut in September, Powell’s tone will be crucial in shaping expectations. The relationship here is anticipatory rather than causal: investor positioning reflects forecasts of policy direction rather than confirmed actions.

Trading volumes were light as many investors remained away for northern hemisphere summer holidays, leaving few catalysts beyond geopolitical headlines. Among major currencies, the Australian dollar rose to $0.6495 following stronger Westpac consumer sentiment data, its highest reading in three and a half years. The New Zealand dollar edged up to $0.59245, while sterling recovered to $1.351 after testing the lower end of its recent range.

Cryptocurrency weakness continues

Digital assets diverged from traditional markets, with bitcoin falling 0.3 percent to extend a three-day losing streak after last week’s record high. Ether dropped 0.6 percent, also retreating after failing to breach its previous peak. The correlation suggests that profit-taking and position adjustments are driving crypto moves independently of the broader macroeconomic and geopolitical backdrop.

The dollar’s steadiness highlights how traders are balancing geopolitical risk with monetary policy anticipation. With thin trading volumes, price action remains constrained, but both Ukraine-related diplomacy and Powell’s upcoming remarks at Jackson Hole have the potential to inject significant volatility into currency markets in the coming days.

Source: Reuters

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Gerik

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Cautious trading in Asia

Asian markets started the week with modest declines as investors braced for the Federal Reserve’s Jackson Hole meeting on August 21–23. MSCI’s broadest Asia-Pacific index outside Japan slipped 0.2 percent in early trading, reflecting subdued sentiment. Japan’s Nikkei hit a fresh intraday record before retreating 0.5 percent, weighed by a sharp 5 percent drop in SoftBank shares after the firm disclosed a $2 billion investment in Intel, a chipmaker struggling with losses. The dollar held firm at 147.78 yen, while the euro remained steady near $1.1658.

In contrast, European futures posted moderate gains, buoyed by signs of diplomatic progress in Ukraine negotiations. Euro Stoxx 50 futures rose 0.3 percent, Germany’s DAX added 0.2 percent, and London’s FTSE gained 0.3 percent. Ukrainian President Volodymyr Zelenskiy said that security guarantees for Ukraine could be finalized within 10 days after meetings with Donald Trump and European leaders. NATO’s Mark Rutte called the talks highly successful, though the Alaska summit between Trump and Vladimir Putin ended without a ceasefire agreement. Trump later suggested a trilateral summit involving himself, Putin, and Zelenskiy is being arranged. The correlation between diplomatic developments and European futures gains highlights how expectations of geopolitical stabilization can support risk sentiment, even without concrete outcomes.

Investor focus on Fed signals

Traders remain cautious ahead of Jerome Powell’s speech at Jackson Hole, which is expected to clarify the Federal Reserve’s policy direction. Current pricing in money markets suggests an 83.6 percent probability of a quarter-point rate cut at the September 17 FOMC meeting. Market behavior shows a causal link between expectations of Fed easing and investor positioning: analysts note that equity strength and dollar weakness hinge on whether Powell signals a dovish shift.

Commodities and currency moves

In commodities, oil prices softened slightly, with US crude dipping 0.2 percent to $63.29 per barrel, reflecting a mix of supply concerns and geopolitical uncertainty. Spot gold traded at $3,334.9 per ounce, edging higher as investors sought a hedge against potential volatility. The dollar index rose to 98.171 after a 0.2 percent gain in the previous session, showing resilience amid cautious risk-taking.

Global markets are caught between cautious anticipation of central bank guidance and tentative optimism about Ukraine peace negotiations. Asian shares reflected investor restraint, while European futures gained on hopes of progress in Washington talks. With Jackson Hole looming, the balance of sentiment will likely hinge on Powell’s tone, as traders weigh geopolitical headlines against the Federal Reserve’s policy outlook.

Source: Reuters

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Winkelmann

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Political

Key points:

● Fed's Jackson Hole summit scheduled for August 21-23

● Trump says U.S. would help Europe provide security for Ukraine

● Russia-Ukraine deal could be negative for gold - analysts

Gold prices were little changed on Tuesday as investors awaited the Federal Reserve's annual conference this week for cues into possible rate cuts, and weighed Washington's efforts to end the war in Ukraine.Spot goldheld steady at $3,331.49 per ounce as of 0201 GMT. U.S. gold futuresfor December delivery fell 0.1% to $3,375.40.

Fed Chair Jerome Powell's remarks at the central bank's symposium on August 21-23 in Wymoing could offer clarity on the economic outlook and expectations of policy easing."Gold is still consolidating and is really waiting for a new catalyst to break higher. I think the big event to watch is Jackson Hole and whether the Fed brings the dovish guidance or not," said Kyle Rodda, Capital.com's financial market analyst.Market participants currently see an 84% probability of a 25-basis-point rate cut at the Fed's next meeting, per the CME FedWatch tool.

Gold typically performs well in a low-interest-rate environment and amid heightened uncertainties.Minutes from the Fed's July meeting, due for release on Wednesday, are expected to provide additional cues into its policy.On Monday, U.S. PresidentDonald Trumptold President Volodymyr Zelenskiy that Washington would help guarantee Ukraine's security in any potential deal to end Russia's war.This assurance followed Trump's meeting with Russian PresidentVladimir Putinin Alaska, which ended without an agreement.

Trump described his meeting with Zelenskiy as "very good", and, in a social media post, said he had called the Russian leader and begun arranging a meeting between Putin and Zelenskiy."In the unlikely event some sort of deal gets struck (between Ukraine and Russia), that could be a very negative surprise for the gold price," Rodda said.Elsewhere, spot silverfell 0.5% to $37.82 per ounce, platinumrose 0.1% to $1,323.76 and palladiumlost 0.9% to $1,112.34.

Source: TradingView

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FastBull Featured

Daily News

[Quick Facts]

1. Trump announces preparations for "Putin-Zelenskyy Meeting," venue for trilateral summit undetermined.

2. Trump does not rule out sending U.S. troops to Ukraine for peacekeeping.

3. U.S. homebuilder confidence declines, dragged down by weak homebuying sentiment.

4. Ukrainian Foreign Minister: Ukraine is doing its best to end the Russia-Ukraine conflict this year.

5. "Europeans Must Have a Seat at the Table" — European Leaders make strong statements after Trump-Zelenskyy meeting.

6. Zelenskyy says Ukraine no longer insists on a ceasefire as prerequisite.

[News Details]

Trump announces preparations for "Putin-Zelenskyy Meeting," venue for trilateral summit undetermined

U.S. President Donald Trump revealed on the social media platform Truth Social that he began arranging a bilateral meeting between Russian President Vladimir Putin and Ukrainian President Volodymyr Zelenskyy, though the specific location remains undecided. Trump stated that during a meeting at the White House, he and European leaders focused on the issue of Ukraine's security guarantees, which European countries and the United States will jointly implement. After the meeting, he spoke by phone with Putin to officially initiate preparations for the Russia-Ukraine leaders' meeting. According to Trump's plan, after the bilateral talks between Putin and Zelenskyy, a trilateral summit involving him, the U.S., Russia, and Ukraine will be held. Currently, U.S. Vice President J.D. Vance, Secretary of State Marco Rubio, and special envoy Steve Witkoff are coordinating with both Russian and Ukrainian sides.

Trump does not rule out sending U.S. troops to Ukraine for peacekeeping

On August 18th, U.S. President Donald Trump held a meeting with Ukrainian President Volodymyr Zelenskyy at the White House. Trump said that if all goes well, a trilateral meeting between the U.S., Russia, and Ukraine will take place. At a press conference, Trump stated that he does not rule out sending U.S. troops to participate in peacekeeping operations in Ukraine in the future. In his remarks, Zelenskyy made it clear that Ukraine needs all security-related guarantees, including troops, weapons, training, and intelligence. He emphasized that only by relying on the commitments of the United States and other major powers can Russia be compelled to seek peace.

U.S. homebuilder confidence declines, dragged down by weak homebuying sentiment

Confidence among U.S. homebuilders fell in August to its lowest level since 2022, forcing builders to rely more heavily on incentives to counter high mortgage rates and persuade hesitant buyers. The overall market conditions index, jointly released by the National Association of Home Builders (NAHB) and Wells Fargo, dropped by 1 point to 32. The median forecast of economists surveyed had predicted a slight increase in the index.

Ukrainian Foreign Minister: Ukraine is doing its best to end the Russia-Ukraine conflict this year

On August 18th, Ukrainian Foreign Minister Sybiha said at a press conference in Kyiv that Ukraine is making every effort to end the conflict with Russia this year. Sybiha pointed out that the meeting between U.S. President Donald Trump and Ukrainian President Volodymyr Zelenskyy later that day in Washington is one of the decisive moments in advancing peace. He stressed that this is a pivotal moment, and by mobilizing diplomatic resources to the greatest extent, there is an opportunity to move closer to a just peace. Ukraine is doing everything it can to end this conflict within this year. Sybiha also stated that Ukraine hopes the meeting between Zelenskyy and Trump will further clarify the details of future security guarantees for Ukraine and advance preparations for the Ukraine-U.S.-Russia trilateral summit. Sybiha added that the Washington meeting is also expected to help clarify the agenda and timeline for the trilateral summit.

"Europeans Must Have a Seat at the Table" — European Leaders make strong statements after Trump-Zelenskyy meeting

On the evening of August 18th, Eastern Time, Ukrainian President Volodymyr Zelenskyy held a bilateral meeting with U.S. President Donald Trump at the White House. Subsequently, several European leaders participated in multilateral talks with both Trump and Zelenskyy. Later that evening, leaders from multiple European countries, as well as officials from the European Union and NATO, commented on the meetings. German Chancellor Olaf Scholz, speaking in Washington on the same day, said that the discussions with Trump, Zelenskyy, and other European leaders had gone smoothly, but that the road ahead would be more complex. He emphasized the need to maintain pressure on Russia and insisted that a ceasefire must come before further negotiations. French President Emmanuel Macron stated in Washington that the location for the meeting between Putin and Zelenskyy would be determined within the next few hours. Macron said that if the process were to stall, additional pressure would need to be applied to Russia. He added that the trilateral summit could take place within two to three weeks and stressed that Europeans must have a seat at the negotiating table.

Zelenskyy says Ukraine no longer insists on a ceasefire as prerequisite

On the evening of August 18th, local time (early morning of August 19th, Beijing Time), Ukrainian President Volodymyr Zelenskyy held a press conference following his White House talks, describing the meeting as the "most successful' between him and the U.S. so far, with in-depth discussions on many details. Zelenskyy emphasized that Ukraine is confident the war will eventually end, but that the key lies not in a pause in fighting but in achieving a genuine peace backed by security guarantees. He stated that Ukraine no longer insists on a ceasefire as a precondition for continuing negotiations. He said that security guarantees are the starting point for ending the war, and that the U.S. has clearly stated it will coordinate among all parties and provide support. Furthermore, the U.S. will also be a participant in Ukraine's security guarantees, reflecting America's political will and decision-making.

Zelenskyy said U.S. President Donald Trump supports holding a trilateral summit involving the U.S., Russia, and Ukraine. The U.S. has proposed holding the summit as soon as possible, but it requires consensus among all parties. Russia has suggested first holding a bilateral meeting between Putin and Zelenskyy, followed by the trilateral summit. Zelenskyy said he agrees with this approach and is willing to meet with Putin. He emphasized that territorial issues can only be discussed during his talks with Putin.

[Today's Focus]

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UTC+8 02:10 Speech by Federal Reserve Governor Michelle Bowman

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Oliver Scott

Ukrainian President Volodymyr Zelenskiy said on Tuesday after his meeting with U.S. President Donald Trump and European leaders that security guarantees for Kyiv will likely be worked out within 10 days.

"Security guarantees will probably be 'unpacked' by our partners, and more and more details will emerge. All of this will somehow be formalised on paper within the next week to 10 days," Zelenskiy said at broadcast press briefing after his meetings.

Trump told Zelenskiy on Monday that the United States would help guarantee Ukraine's security in any deal to end Russia's war there, though the extent of any assistance was not immediately clear.

"It is important that the United States is sending a clear signal that it will be among the countries helping to coordinate and will also be a participant in the security guarantees for Ukraine," Zelenskiy said. "I believe this is a major step forward."

Although a peace deal appeared far from imminent after the meetings in Washington, Zelenskiy said his Monday meeting with Trump was his "best" so far.

He also said Ukraine was ready to meet with Russia in "any format" and that territorial issues would be discussed on a bilateral level with Russian President Vladimir Putin - but no dates for a possible meeting with Moscow have been scheduled yet.

"The question of territories is something we will leave between me and Putin," Zelenskiy said.

He added that a part of security guarantees for Ukraine is a package of U.S. weapons "which primarily includes aircraft, air defence systems," among others.

"There indeed is a package with our proposals worth $90 billion," Zelenskiy said.

"And we have agreements with the U.S. president that when our export opens, they will buy Ukrainian drones. This is important for us."