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EUR

Markets stabilise ahead of crucial inflation data

Good morning. The US dollar is trading near a seven-month low ahead of key inflation data today and tomorrow that could determine the outcome of next week’s Federal Reserve meeting. Flows through the Strait of Hormuz have slowed to a trickle after a series of American and Iranian attacks on ships and energy infrastructure, forcing global oil prices back above $100 a barrel. Ten-year Treasury yields are holding near a three-year high after the Treasury said yesterday it would buy just $6bn of long-dated bonds in its buyback operation, disappointing investors who had expected a purchase volume closer to $10bn....

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Oil & bond yields in focus

• Shaky sentiment. Another rise in oil & long end bond yields dampened the mood. Equities a bit lower. NZD underperformed while AUD held up.• Macro trends. ECB expected to hike tonight. US producer prices due. RBA rhetoric has been ‘hawkish’. Late-September RBA hike now ~75% priced in. Global Trends A few jitters have returned to markets with higher oil prices, on the back of the intensification of attacks on shipping and energy infrastructure in the Middle East, and another move up in bond yields dampening the mood. Brent crude has risen above US$101/brl to be at the top end...

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Dollar steadies as energy prices climb and inflation print looms

Good morning. The dollar is holding firm as a new outbreak of hostilities in the Middle East sends oil prices to their highest since late July, raising the stakes ahead of Friday’s US inflation report—and next week’s Federal Reserve meeting. Brent crude, the global benchmark, is holding near $100 a barrel after the US and Iran each attacked oil tankers over the weekend, and Yemen’s Iran-backed Houthis struck energy facilities and cities across Saudi Arabia. Ten-year Treasury yields are near levels last seen in January 2025, equity futures are pointing to a weaker open, and speculators are paring long bets...

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JPY in the driver’s seat

• Market swings. US holiday overnight. US/Iran tensions supporting oil. JPY rebound weighing on USD & indirectly boosting currencies like the AUD.• Macro pulse. RBA’s Hunter & Hauser speak today. US CPI this week. Markets factoring in ~60% chance Fed hikes next week & RBA moves this month. Global Trends With the US enjoying a long weekend holiday most financial markets were relatively quiet at the start of the new week. Tit-for-tat strikes between the US and Iran continue to dampen sentiment a little and are adding a risk premium to oil with brent crude now north of US$97/brl, ~21%...

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USD under pressure. US jobs data in focus.

• Positive vibes. Equities rose & the USD slipped back as markets tempered near-term US Fed rate hike bets & USD/JPY fell. AUD at top of recent range.• Data pulse. Post Q2 AU GDP markets factoring in another RBA hike by November. High chance it happens this month. US jobs report out tonight. Global Trends Risk sentiment has been positive over the past couple of sessions with oil prices stabilising (albeit at elevated levels with brent crude tracking near ~US$96/brl) and traders paring back expectations for near-term US Fed rate hikes. Odds of a mid-September rate rise by the US...

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