Global Markets Teeter on Delicate Balance Between Growth and Risk

The past week has seen significant shifts in global markets, revealing a delicate balance between growth, disruption, and rising financial risks.

A joint intervention by the US to buy Japanese yen on August 4 was one of the most notable moves, with potential financing routed through the euro and use of the Federal Reserve's FIMA repo facility.

The move aimed to ease pressure on Tokyo to sell U.S. government bonds but may signal that risks to the U.S. Treasury market have not disappeared.

Ron Bousso notes that global oil-refining capacity has been reduced by around 5 million barrels per day due to the war in Iran, giving refiners significant pricing power and pushing margins on gasoline, diesel, and jet fuel to record levels.