- Escalating US-Iran hostilities initially lifted WTI crude to a six-week high and pushed the 10-year Treasury yield to a 2.75-year high; oil later retreated after officials said more than 17 million barrels moved through the Strait of Hormuz.
- UK five-year swap rates rose above 4.52%, a three-year high, signaling higher fixed-term mortgage rates as the bond-market sell-off increased inflation and rate-hike expectations.
- South African Reserve Bank Governor Lesetja Kganyago said policymakers should respond cautiously to oil-driven inflation aftershocks and drought-related pressure.
- The dollar gave back early gains as crude prices and Treasury yields fell, while weaker-than-expected ADP employment data reduced support for higher US rates.
Quotes
“We are dealing with, for lack of a better word, what I would call a polyshock, and that means that the decisions that we take are, not that they were ever easy, but they have just become even more difficult”
“The manner in which we respond to the aftereffects of the shock can continue to be measured.”
“inflation isn't close to our medium-term target”
“is not necessarily set in stone”