Morning wrap (28.01.2026)

The Asia–Pacific session is unfolding in exuberant mood after Wall Street indices closed at record highs. Chinese indices are up between 1.70% and 2.50%, while the Japanese index is gaining 1.65%.

US equity benchmarks ended yesterday at all-time highs just ahead of today’s Fed decision and earnings from key Big Tech companies. The US100 closed above 26,300 points, the US500 at 7,040 points, and the US2000 at 2,685 points.

Precious metals continue to post even more extraordinary gains. Gold is up another 1.60% today to USD 5,260 per ounce, while silver is rising 2.20% to USD 114.45 per ounce.

The US dollar has recovered most of Tuesday’s sell-off triggered by Trump’s comments. The USDIDX is up 0.37%, EURUSD is down 0.35%, and USDJPY is higher by 0.22%.

The Australian dollar is also in focus today, standing out as one of the stronger G10 currencies following inflation data.

Australian inflation was the key market driver — both Q4 CPI and the December monthly print came in above forecasts.

Inflation accelerated again in December, with headline CPI at 3.8% y/y and core inflation at 3.4% y/y. The six-month annualised core pace implies around 3.9%, inconsistent with a rapid return to target. Services inflation rose to 4.1% y/y (from 3.6%), driven mainly by travel, accommodation and rents — key areas for the RBA.

The Australian dollar climbed back above USD 0.70, and markets began pricing in a 25 bp RBA rate hike in February. The probability of such a move at the 3 February meeting has risen to over 70% (from around 60% previously).

Westpac joined forecasts for a 25 bp hike in February, citing core inflation as the decisive factor. The bank views the move as likely a one-off, with a conditional stance toward further tightening.

China approved the first imports of Nvidia’s H200 AI chips, with reports of “several hundred thousand” units initially destined for three major technology firms. This is a positive signal for Nvidia and its supply chain.

Minutes from the Bank of Japan’s December meeting confirmed that policymakers remain focused on the impact of a weak yen on inflation — although this may have shifted given recent successful yen interventions. The BoJ already raised rates by 25 bp at the end of 2025 to 0.75% (the highest since the mid-1990s), and the minutes kept the door open to further tightening while stressing data dependence.

Goldman notes that risk appetite remains elevated despite rising geopolitical uncertainty. Its risk-appetite indicator is at its highest level since April 2021.

Analysts also suggest that Trump may announce a nominee for Fed chair as early as this week. Powell’s term runs until May, but the White House may seek to influence the narrative sooner.