The Federal Reserve held its policy rate steady at 3.5–3.75% in a 10-2 decision on 29 July, with two governors dissenting in favour of a 25 basis point cut, underscoring a cautious but internally divided committee. The decision triggered extreme intraday volatility on Wall Street, with the S&P 500 experiencing three directional swings representing approximately US$2.9 trillion in market cap movement, while the VIX surged 13.45% to 20.66. Simultaneously, the ECB held its deposit facility rate at 2.25% with a data-dependent stance, and geopolitical tensions in the Middle East drove sharp energy price moves, with Brent crude surging as much as 8% intraday before settling up 7.50% at US$90.40 per barrel. Risk sentiment globally ended the session in risk-off territory, with gold reaching US$4,132 per ounce as a safe-haven bid and US Treasury yields easing modestly across the curve.
For Asia-Pacific markets opening today, the overnight US equity sell-off — S&P 500 down 1.52%, Nasdaq down 1.74%, and the Nikkei VIX spiking 26.94% to 41.14 — sets a cautious tone, though the ASX enters the session from a position of relative strength given Wednesday's 0.60% gain and a five-month high. The KOSPI's extraordinary 10.84% decline and the Nikkei 225's 3.95% fall suggest significant regional stress that could weigh on sentiment at the open. However, cooling Australian inflation data has reduced domestic rate-hike expectations, the AUD/USD sits at 0.6959, and the ASX VIX actually fell 1.67% to 11.16, indicating local volatility pricing remains contained relative to offshore peers. Investors will be watching today's FOMC press conference transcript fallout, the BoE rate decision at 21:00 AEST, and US Advance GDP at 22:30 AEST for the next directional cue.