Global stock markets surged to new highs as investors anticipate a U.S. rate cut next month due to low inflation. President Trump’s influence on the Fed and other institutions is causing concern. Latin American currencies have outperformed, but analysts question if this trend can continue given U.S. political and economic uncertainty.

The U.S. dollar weakened by 0.5% as markets bet on a Fed rate cut. Stock markets hit new highs with sectors like communications leading the way. Bond yields fluctuated, while oil prices fell. Trump’s interference in economic matters and attacks on Fed Chair Powell are causing unease among investors.

Latin American currencies have seen a remarkable rise against the dollar this year. Factors contributing to this include attractive “carry” rates and high real yields in countries like Brazil and Mexico. However, analysts warn that gains may be capped in the second half of the year due to the strong performance in the first half.

Investors are closely watching Chinese corporate earnings, Thailand’s interest rate decision, and Japan’s economic indicators. Trump’s influence on global markets, particularly regarding tariffs on Brazil and trade negotiations with Mexico, continues to create uncertainty. Investors are advised to stay informed and cautious in this volatile market.

Read more at Yahoo Finance: World stocks boom, Fed cut looms