Tuesday’s triple risk: Tariffs, RBA rate cut, and U.S. inflation

Traders face a busy Tuesday with developments on U.S. China trade talks, a RBA policy decision, and the latest U.S. inflation data.

U.S. China tariff deadline – Tuesday
The current truce between the U.S. and China is set to expire on 12 August, with U.S. Commerce Secretary Lutnick indicating it will likely be extended by 90 days. China may also face an additional 25% tariff on Russian oil imports, like measures already applied to India.

RBA announcement – Tuesday
The Reserve Bank of Australia is widely expected to cut rates, with a Reuters poll showing all 40 surveyed economists anticipating a 25bp reduction to 3.60%. The broader market is pricing a 98% probability of that outcome and a 2% chance of a larger 50bp cut.

U.S. CPI – Tuesday
Headline U.S. CPI for July is expected to rise 0.2% month-on-month taking the annual rate to 2.8% from 2.7%. Wells Fargo notes that the figures may show further signs of higher tariffs feeding into consumer prices.