Oil Price Surge Weighs on Global Markets Amid Rate Hike Fears
Global markets have taken a hit as crude oil prices continue to surge due to renewed hostilities between the U.S. and Iran. The sharp increase in oil prices has led to fears of inflation, causing bond yields to rise across regions. The Federal Reserve's rate hike expectations have also contributed to this trend.
The six-currency Dollar Index has rallied as markets price in the increased likelihood of a quarter-percentage rate hike on September 16. The CME FedWatch tool shows a 66.2% chance of a rate hike, up from 65.4% the previous day. Japan's ten-year bond yield crossed 3% for the first time since September 1996.
The price of Brent crude oil has extended its gains, rising by nearly 5%. Gold prices have declined, however, due to concerns about rate hikes and inflation. The cryptocurrency market is trading mixed today.