Oil Surge Triggers Global Sell-Off as Rate Hike Bets Skyrocket
Asian stocks and bonds fell on Friday (Sep 11) after a surge in oil prices sparked a sell-off in US markets, while inflation data reinforced bets on an imminent US Federal Reserve interest rate hike.
The MSCI Asia Pacific Index dropped 1.4 per cent, led by declines in South Korea and Japan, following the S&P 500 Index's 0.5 per cent decline.
Brent crude rose 0.4 per cent to nearly $110 a barrel after an increase in attacks on shipping through the Strait of Hormuz pushed up oil prices, fueling concerns about energy costs feeding into inflation.
US producer price data showed a 0.4 per cent rise in August from July, its highest since May, prompting traders to boost wagers on a Fed rate hike next week.
South Korea's Topix and Japan's Nikkei both fell over 1.8 per cent, while Australia's S&P/ASX 200 declined by 1 per cent.