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The RBA continues to take few chances when it comes to the problematic domestic inflation trends with another interest rate hike announced today. This is the third consecutive meeting the RBA has tapped on the brakes with the latest 25bp increase moving the cash rate up to 4.35%. Policy settings have been recalibrated quickly. The interest rate ‘relief’ delivered last year has been unwound with the...
• Optimistic markets. Equities rose, oil dipped on positive US/Iran vibes. More volatility likely. USD softens. AUD whipped around by push/pull forces.• RBA hike. RBA announced its 3rd straight rate rise. Another hike more likely than not. But it will come at an economic cost. Growth set to slow sharply.
Global Trends
Sentiment about the situation in the Middle East has generated a few bursts of...
America produces more crude than anyone. That does not spare it—or the dollar—the consequences of an oil shock.
A comforting narrative has taken hold in Washington. The shale revolution, which transformed America into the world’s largest producer of crude oil, is supposed to have insulated the country from the geopolitical convulsions that have long roiled energy markets. Since the war in Iran...
Good morning. Markets are steadying and crude prices are pulling back from their highs as the US and Iran avoid further escalation after a series of skirmishes in the Strait of Hormuz raised questions about the durability of the ceasefire struck in early April. Yesterday’s American attempt to open the waterway—dubbed “Project Freedom”—sank at least six Iranian fast-attack boats and triggered...
Happy Monday. Oil prices are reverting higher and the dollar is holding steady after President Donald Trump announced plans to “guide”—but not escort—shipping through the Strait of Hormuz. US Central Command, which is currently blockading Iranian ports, said 15,000 service members and more than 100 aircraft, along with warships and drones would support the initiative, yet stopped short of putting surface...
• JPY jump. USD weaker as Japanese officials intervene to prop up the very weak JPY. This & positive sentiment boosted the AUD & NZD.• Macro trends. Further bouts of JPY intervention possible. US GDP re-accelerates. BoE & ECB hold rates steady, but ECB hints at future hikes.
Global TrendsA few push-pull forces washed through markets overnight with risk sentiment generally improving at...