Asian Stocks Rise as Strong US Jobs Data Boosts Rate Hike Bets
Asian stock markets are expected to rise on Monday as strong US jobs data has boosted bets for a Federal Reserve rate hike in September. This, combined with escalating US-Iran tensions and concerns over disrupted crude supplies, is driving up oil prices.
The Brent crude price climbed 0.5% after Iran said it had targeted three oil tankers using an unauthorized route through the Strait of Hormuz. The latest attacks suggest little prospect of an end to the ongoing conflict between the US and Israel, which has added to inflation concerns in the US.
US inflation data due on Friday will be closely watched, particularly after stronger-than-expected jobs data nudged up bets for a rate hike. A hot CPI print would likely seal a September hike and underpin a firmer US dollar, while a cooler reading would strengthen the case for a hold and leave the USD vulnerable to a dovish Fed repricing.
The yen remained in focus, fluctuating around 156 per US dollar after a 2.4% gain in the week ended Sep 6, spurred by an unwind in carry trades amid growing expectations for successive Bank of Japan rate hikes. Speculation has also grown that Japan's Government Pension Investment Fund (GPIF) may raise its target allocation to domestic bonds.