It was a light day in terms of top-tier economic reports, but that didn’t stop markets from making big moves while bracing for the upcoming July 9 tariffs deadline.

Geopolitical developments and OPEC+ updates also caused major waves in the energy sector, leading crude oil to close nearly 3% higher for the day.

Here are headlines you may have missed in the last trading sessions!

Headlines:

• Over the weekend, Israel military confirmed attacks on several terrorist targets in Yemen
• Greek-owned cargo ship in Red Sea struck by rocket-propelled grenade and gunfire on Sunday, attack linked to Houthi militants
• OPEC+ agreed to increase oil output by 548K bpd vs. 411K bpd expected
• China restricted gov’t purchases of medical devices from EU in retaliation for last month’s decision barring Chinese firms from bidding on public tenders for medical devices
• On Sunday, Trump threatened to impose additional 10% tariffs on countries aligning with “anti-American policies of BRICS”
• U.S. Treasury Secretary Bessent said tariffs will revert to April 2 levels by August 1 if no agreements are made
• Japan Average Cash Earnings for May 2025: 1.0% y/y (2.4% y/y forecast; 2.3% y/y previous)
• Japan Overtime Pay for May 2025: 1.0% y/y (0.9% y/y forecast; 0.8% y/y previous)
• Australia ANZ-Indeed Job Ads for June 2025: 1.8% m/m (0.2% m/m forecast; -1.2% m/m previous)
• Japan Leading Economic Index for May 2025: 105.3 (104.5 forecast; 104.2 previous)
• Germany Industrial Production for May 2025: 1.2% m/m (-0.6% m/m forecast; -1.4% m/m previous)
• U.K. Halifax House Price Index for June 2025: 0.0% m/m (-0.2% m/m forecast; -0.4% m/m previous); 2.5% y/y (2.2% y/y forecast; 2.5% y/y previous)
• Euro area Retail Sales for May 2025: 1.8% y/y (1.7% y/y forecast; 2.3% y/y previous); -0.7% m/m (-1.0% m/m forecast; 0.1% m/m previous)
• China’s gold reserves rose for the eighth consecutive month in June at 73.90 million ounces, up from 73.83 million ounces at the end of May
• President Trump announced 25% tariffs on Japan and South Korea by August 1, with Malaysia and South African nations also getting additional tariffs
• Tesla shares hit hard as Trump criticized Elon Musk as “completely off the rails” following his criticism of the newly-passed tax bill

Broad Market Price Action:

Dollar Index, Gold, S&P 500, Oil, U.S. 10-yr Yield, Bitcoin Overlay Chart by TradingView

Several major headlines greeted market participants after the long weekend, as a combination of flaring Middle East tensions and the OPEC+ decision got energy sector traders off to a roaring start.

WTI crude oil bulls picked up on reports of an Houthi-linked attack on a vessel in the Red Sea, as well as the Israeli military’s confirmation that they targeted multiple terrorist sites in Yemen. This allowed the energy commodity to recover from its brief dip spurred by the OPEC+ announcement of a larger than expected increase in production, extending its rally throughout the London and U.S. sessions to close 2.71% higher.

Gold, on the other hand, retreated while risk appetite picked up on news that U.S. trade negotiations could still be extended and that the deadline to bump tariffs back up to April 2 levels has been pushed back from July 9 to August 1. However, risk-off vibes lifted the precious metal back to its open price later in the day, as Trump threatened a fresh batch of higher trade levies.

Equity futures moved sideways in positive territory while investors retained some optimism that trade talks could result to actual deals in the coming days, although the announcement of 25% tariffs on South Korea and Japan sparked a fresh round of risk aversion that led U.S. stock indices to close mostly flat.

Treasury yields, which were already on a gradual climb in the early trading sessions, sustained its rally during U.S. market hours while safe-haven flows appeared to lift the U.S. dollar.

FX Market Behavior: U.S. Dollar vs. Majors:

Overlay of USD vs. Majors Chart by TradingView

The U.S. dollar was off to a strongly bullish start, although it dipped briefly against JPY on an uptick in Japan’s leading indicators, staging a steady climb during the Asian session and the early London session while markets digested the impact of the U.S. tariffs deadline extension and resurfacing geopolitical tensions.

A bit of profit-taking and a slight pickup in risk appetite led higher-yielding commodity currencies and psuedo-risk currency GBP to advance during the latter part of the London session, as “TACO” expectations came in play and investors appeared cautiously optimistic that more trade deals could be struck during the tariffs delay.

However, another round of safe-haven flows kicked in during the U.S. session when Trump declared 25% tariffs on Japan and South Korea while U.S. media continued to report on additional tariffs letters being sent out. USD recovered across the board, with USD/JPY sustaining its climb to close 1.14% higher and NZD/USD and AUD/USD chalking up nearly 1% in losses.

Upcoming Potential Catalysts on the Economic Calendar

• Australia RBA Interest Rate Decision at 4:30 am GMT
• Japan Eco Watchers Survey Outlook at 5:00 am GMT
• Australia RBA Press Conference at 5:30 am GMT
• Germany Balance of Trade at 6:00 am GMT
• France Balance of Trade at 6:45 am GMT
• U.S. NFIB Business Optimism Index at 10:00 am GMT
• Canada Ivey PMI at 2:00 pm GMT
• U.S. Consumer Inflation Expectations at 3:00 pm GMT
• U.S. Consumer Credit Change at 7:00 pm GMT
• U.S. API Crude Oil Stock Change at 8:30 pm GMT

The main event for the day is the Reserve Bank of Australia’s (RBA) monetary policy decision, during which policymakers are expected to cut interest rates while probably suggesting a slower pace of easing down the line.

After that, we’ve got Canada’s Ivey PMI report lined up for the U.S. trading session, potentially spurring additional volatility for Loonie pairs. As always, stay nimble and don’t forget to check out our Forex Correlation Calculator when taking any trades!