Tariffs in Legal Limbo

• Over the weekend, US political headlines were dominated by trade policy after the Federal Appeals Court ruled that President Trump’s ‘reciprocal’ tariffs had been imposed unlawfully, upholding an earlier judgment from the Court of International Trade.
• The tariffs remain in effect for now as the case moves through the courts, and Trump is expected to appeal to the Supreme Court.
• On the data side, US PCE inflation matched forecasts: the core measure rose 0.3% in July and 2.9% over the year, still well above the Fed’s 2% target.
• Fed market pricing showed little movement, with around 22bp of cuts implied for September and just over 50bp by year-end.
• Domestically, focus will shift to Wednesday’s Q2 GDP release (consensus +0.5% q/q), followed by a speech from RBA Governor Bullock in the evening.