ASX to edge up; Wall Street recovers as oil threat recedes
The week's big financial highlight is the US Federal Reserve rates decision. The Fed is expected to hold rates steady - investors will focus on chairman Jerome Powell's comments after the decision.
Money market moves show traders are pricing a 56% chance of a 0.25 percentage point rate cut in September, according to CME Group's Fedwatch tool.
'We expect the median participant to take on a more stagflationary flavor following April's tariff surprises, despite eased financial conditions from the weaker dollar, with higher inflation and downgraded GDP growth in 2025,' Barclays strategists said in a note.
'The dot plot is likely to show delayed rate cuts, with just one this year and three in 2026.'
The Reserve Bank of Australia will look through any temporary spike in inflation caused by higher oil prices, as economists warn that an escalation of the war between Israel and Iran could trigger a financial market meltdown.
Market highlights
ASX futures are pointing up 6 points or 0.1 per cent to 8566
All US prices are as of New York time.
Tuesday's agenda
The first of three big central bank decisions starts with the Bank of Japan delivering its interest rate decision this morning. Traders expect no change to rates. NZ releases select price index data.
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