Oil Prices Spike Past $98 Amid US-Iran Conflict

A surge in oil prices has pushed Brent crude above $98 per barrel, sparking inflation concerns ahead of the European Central Bank's (ECB) meeting. The recent escalation of conflict between the US and Iran has contributed to the increase in global borrowing costs.

The Germany 10-year bund yield reached a high of 3.2% for the first time since 2011, while markets see a one-in-five chance of an interest rate hike at this meeting. However, there is a four-in-five chance of a hike in September.

Senior rates strategist Michiel Tukker from ING noted that 'one could argue for a front-loaded hike today, but over previous years the ECB has always fully telegraphed any policy moves in advance.'