Woofun AI data shows that US June CPI fell to 3.5% year-on-year, with core CPI slowing to 2.6%, marking the first negative month-over-month growth since 2020. This decline was primarily driven by a 5.7% drop in energy prices and a 9.7% plunge in gasoline costs, rather than broad demand weakness. Consequently, market expectations for year-end interest rate hikes decreased, triggering a synchronous rebound in equities, gold, and cryptocurrencies, with Bitcoin briefly approaching $65,000.

Fed Chair Powell maintained a "zero tolerance" stance on inflation during congressional testimony, emphasizing that interest rates and balance sheet tools remain viable options.

Meanwhile, escalating Middle East tensions and US naval operations against Iran introduce uncertainty to energy supply and inflation trajectories.

Additionally, the USD/JPY return to 162 raises concerns regarding yen carry trade risks, which could increase volatility in global tech stocks and high-risk assets if the Bank of Japan intervenes or US economic data weakens.