Oil Price Surge Sends Global Yields Soaring Amid U.S. Inflation Watch
Global currency markets have been subdued in cautious trading on Thursday as investors weigh a fresh surge in oil prices and global bond yields. The Brent crude futures remained above $100 a barrel after breaching that level on Wednesday, with Iran and the U.S. engaging in the biggest wave of attacks on shipping by both sides since the start of the war.
The energy-induced inflation pressure has sent global bond yields back on an upward trajectory, with benchmark 10-year Treasury yields hitting their highest levels since 2023 as a buyback programme of longer-dated bonds also disappointed. The greenback found some marginal relief, leaving the euro and sterling slightly weaker at $1.1633 and 1.3547, respectively.
The Japanese currency's climb to fresh seven-month highs was paused, with the yen last trading a shade weaker at 153.70 ahead of an expected Bank of Japan rate hike next week. Attention is now firmly on macros, including U.S. inflation readings, which will later shift focus to the FOMC meeting on September 15-16.