**Markets Next Week: All Eyes on US PCE Inflation Amid Middle East Uncertainty** After posting its strongest weekly performance in two months, the US dollar traded in a choppy but largely neutral range between **98.8–99.4**. Early strength came from renewed Middle East tensions. But the move faded after Iran floated a fresh peace proposal, Trump claimed negotiations were entering the “final stages,” and reports suggested some ships had successfully crossed the Strait of Hormuz. Oil gave back part of its gains, limiting further upside for the dollar. Still, the dollar didn’t break down either. The reason: **Fed minutes showed growing inflation anxiety**, with several policymakers appearing more open to rate hikes if price pressures persist. ### Key Focus: US Core PCE The major catalyst this week is **Thursday’s Core PCE inflation report**, the Fed’s preferred inflation gauge, alongside personal income/spending data and the second Q1 GDP estimate. With both CPI and PPI recently surprising to the upside, markets fear PCE could do the same. **Hot PCE + solid growth = stronger rate hike expectations = bullish USD / pressure on risk assets.** If Middle East peace talks fail again while inflation stays sticky, dollar accelerate. ### Global Events to Watch 🇳🇿 **New Zealand (RBNZ):** Markets expect a hawkish hold, but July hike odds remain elevated. 🇦🇺 **Australia CPI:** Strong inflation could revive aggressive RBA tightening expectations and support AUD. 🇯🇵 **Tokyo CPI:** A hotter print may increase BOJ hike odds, helping the yen and reducing intervention pressure. 🇪🇺 **Eurozone CPI (Germany/France/Italy):** Inflation remains sticky, but weak growth limits EUR upside despite ECB tightening. 🇨🇦 **Canada GDP:** Strong data + oil resilience could support CAD. ### Crypto Angle For crypto, this is straightforward: **Soft PCE:** Risk-on, weaker dollar, bullish for $BTC / $ETH / alts **Hot PCE:** Higher yields, stronger dollar, pressure on $BTC and growth-sensitive sectors #RateHikeBackOnTable #USIranNukeDeadlock