In Wednesday’s Asian session, the US Secretary of State Marco Rubio told Southeast Asian foreign ministers that Iranian control of the Strait of Hormuz, a vital passage to almost 20% of global energy supply, would set a dangerous precedent with repercussions beyond the Middle East.

Yemen’s Houthis said that they have closed the Bab el-Mandeb Strait to Saudi-linked shipping in retaliation for the kingdom’s blockade on Yemen and a recent attack on the international airport in Yemen’s rebel-held capital, Sanaa, the Guardian reported on Wednesday.

Japan’s Finance Minister Satsuki Katayama said on Wednesday that the authorities will take necessary steps on the foreign exchange if necessary. 

West Texas Intermediate (WTI) oil price gains ground for the second successive day, trading around $84.60 per barrel during the Asian hours on Wednesday. Crude oil prices surge as supply risks intensified across several key export routes, extending well beyond the Middle East.

The EUR/USD pair trades with mild gains around 1.1405 during the early Asian session on Wednesday. A hawkish tone from the European Central Bank (ECB) provides some support to the Euro (EUR) against the US Dollar (USD). Traders await the upcoming ECB interest rate decision on Thursday. 

Japan Merchandise Trade Balance Total below expectations (¥-120B) in June: Actual (¥-406.9B)

Japan Exports (YoY) registered at 19.3% above expectations (18.6%) in June

Japan Imports (YoY) above expectations (21%) in June: Actual (25.4%)

Iran's top joint military command said that Tehran will expand its strikes and target the US and its allies' interests across the region if the US attacks Iran's nuclear sites, Xinhua news agency reported on Tuesday.

South Korea Producer Price Index Growth (MoM) down to 0% in June from previous 0.8%

South Korea Producer Price Index Growth (YoY) up to 8.6% in June from previous 8.5%

A Reuters poll revealed that the Federal Reserve is most likely to keep interest rates unchanged for the rest of the year as it battles stubbornly high inflation that has remained above the Fed’s 2% goal for at least 5 years.

BNY’s Geoff Yu highlights how China’s regulators and state-backed funds have stepped in to stabilize A-shares after global tech deleveraging hit domestic markets.

Societe Generale’s technical team notes USD/KRW failed twice to break above the June high around 1,561, triggering a deeper decline towards the 200-day moving average. The pair is now testing this key MA, with next support at a multi-month ascending trend line near 1,464/1,461.

Commerzbank’s Moses Lim and Dr. Henry Hao note that Singapore’s June non-oil domestic exports (NODX) growth moderated to 20.7% year-on-year but remained strong, with electronics exports surging on AI-related semiconductor demand.

OCBC’s Sim Moh Siong and Christopher Wong see USD/IDR easing modestly from recent highs, helped by S&P’s rating affirmation and Bank Indonesia’s prior tightening. However, elevated Oil prices, lingering fiscal concerns and still-soft portfolio inflows limit further IDR gains.

United Overseas Bank’s (UOB) Quek Ser Leang expects USD/SGD to stay confined to tight ranges in the near term, with intraday price action lacking clear momentum.

United States (US) President Donald Trump said during a press conference at the White House on Tuesday that Washington could intensify its military campaign against Iran, including possible strikes on the underground Pickaxe Mountain site.

Standard Chartered Bank economist Saurav Anand highlights rising inflation risks for India as deficient monsoon rains and persistent El Niño threaten food output. The report notes sowing is down and reservoir levels are low, with pulses, vegetables, sugar and oilseeds most exposed.

New Zealand GDT Price Index climbed from previous -4.9% to 1.5%

ING’s Francesco Pesole notes that Gilts and the Pound saw turbulence as new UK Prime Minister Andy Burnham signalled flexibility on fiscal rules and appointed John Healey as Chancellor.

Societe Generale strategists note that softer June inflation in Canada has stalled the Canadian Dollar’s (CAD) rebound from 1.4250 toward 1.40 against the US Dollar (USD). Failure to reclaim the 50-day moving average around 1.3991 and new US tariffs on Canadian goods complicate the mean-reversion.

United States Redbook Index (YoY) fell from previous 8.2% to 7.8% in July 17

ING’s Warren Patterson and Ewa Manthey highlight a softening Aluminium supply picture. Global primary output fell in June on both monthly and yearly bases, even as first-half production stayed broadly stable.

Private-sector hiring in the US has further cooled in early July. According to the NER Pulse, the weekly companion to the ADP National Employment Report, companies added an average of 16.5K jobs per week in the four weeks ending July 4.

United States ADP Employment Change 4-week average declined to 16.5K in June 27 from previous 19.75K

Mexico Retail Sales (MoM): -0.6% (May) vs previous 0.8%

Mexico Retail Sales (YoY) fell from previous 4.4% to 1.6% in May

ING’s Frantisek Taborsky expects the National Bank of Hungary (NBH) to cut rates by 25bp to 5.75%, continuing its easing cycle despite recent FX and rates pressure.

Commerzbank’s Tatha Ghose expects the central bank of Hungary Magyar Nemzeti Bank (MNB) to cut its base rate by 25bp to 5.75%, continuing June’s easing cycle.