**Forex Market Overview: Asian Currencies Steady Amid U.S.-China Negotiations**

As of Wednesday, Asian currencies and the U.S. dollar displayed minimal fluctuations as market participants closely monitored the recent U.S.-China trade discussions. Following two days of negotiations in London, both nations have established a preliminary framework aimed at rejuvenating trade relations.

Despite this positive development, investors remain cautious, particularly with the U.S. consumer inflation report set to be released shortly. This data is expected to reveal potential tariff-related price pressures, which could significantly influence the Federal Reserve’s monetary policy decisions.

The U.S. Dollar Index, which gauges the dollar against a basket of major currencies, saw a slight increase of 0.1% during early Asian trading hours, while Dollar Index Futures remained stable.

**Implications of U.S.-China Trade Framework**

The U.S. and Chinese officials concluded their discussions with the establishment of a high-level framework on June 10-11. This agreement aims to bridge the trade gap and address lingering concerns regarding export controls. A focal point of the framework involves lifting restrictions on China’s rare earth mineral exports in return for a relaxation of certain U.S. export restrictions, particularly concerning semiconductors. However, it’s crucial to note that this proposed agreement is still pending formal endorsement by Presidents Donald Trump and Xi Jinping.

While Asian equities posted modest gains in response to the talks, foreign exchange markets appeared reticent, reflecting a lack of detailed commitments regarding tariff reductions.

Currency pairs remained stable with the Chinese yuan’s onshore (USD/CNY) and offshore (USD/CNH) rates showing little change. The Japanese yen’s USD/JPY saw a minor increase of 0.1%. The South Korean won strengthened slightly with the USD/KRW pair rising 0.3%, while the Singapore dollar’s USD/SGD remained relatively unchanged. Conversely, the Indian rupee (USD/INR) edged down by 0.1%, and the Australian dollar (AUD/USD) dipped 0.2%. Other regional currencies, including the Philippine peso (USD/PHP), Thai baht (USD/THB), and Taiwan dollar (USD/TWD), exhibited muted movements.

**Market Outlook: U.S. CPI Report on the Horizon**

Adding to the cautious sentiment, attention is now shifting towards the imminent U.S. consumer price index (CPI) inflation report, which is set to be released later today. Market participants are expected to analyze this data for indications of tariff-induced inflation, which could play a pivotal role in shaping the Federal Reserve’s upcoming interest rate strategies.

Current consensus suggests that the Fed is likely to maintain its interest rate stance in the next meeting, given the prevailing uncertainties surrounding trade policies and tariffs.

As traders prepare for today’s developments, particularly the U.S. CPI release, it’s essential to stay informed on how these trade negotiations and inflation data may impact currency movements in the coming weeks. Being well-prepared can provide traders with opportunities to adjust their strategies amidst evolving market dynamics.