Know What's Happening in Global Economy
Know What's Happening in Global Economy
Japan’s ultra‑loose policy fuels $435 billion yen carry‑trade, raising global risk
The Bank of Japan’s ultra‑loose stance has turned the yen into the world’s cheapest funding currency, enabling a massive carry‑trade that amassed roughly $435 billion between 2022 and 2024. A modest rate hike in March 2024 barely dented the trade, but markets remain wary that aggressive tightening could shrink spreads and force borrowers to repay yen‑denominated debt.
The war between Israel and Iran has escalated into direct strikes on oil and gas infrastructure, effectively closing the Strait of Hormuz and pushing crude prices above $100 a barrel. Missile attacks have damaged the South Pars gas field and Qatar's LNG export hub, cutting roughly 17% of its capacity for the next five years. The International Energy Agency warned this conflict represents the greatest historical threat to global energy supply, urging consumers to curb usage. Resulting supply shocks are rippling through fertilizer, semiconductor inputs, and transportation costs worldwide.
Iran announced a $2 million fee for vessels transiting the Strait of Hormuz and warned it could close the waterway, a move that threatens a chokepoint handling roughly one‑fifth of global oil trade. The announcement has triggered swift condemnation from the...
The episode examines how recent attacks on Gulf energy infrastructure, sparked by the US‑Israeli conflict with Iran, are driving volatile oil and gas prices and threatening global supply chains. The International Energy Agency urges governments to cut demand by promoting...
Assuming the USS Boxer is heading to the Middle East, and considering that she only left San Diego two days ago, she won't be near the Persian Gulf until mid-April. If the reinforcements are intended to reopen the Strait of...
Critics say the Liberal government is exposing Inuit communities to Chinese surveillance and economic dependence through unchecked Arctic investments. A report by the China Strategic Risks Institute warns that Beijing is leveraging infrastructure deals to gain data access and influence...
Energy and materials sectors lead the S&P 500 with near‑28% and 10% year‑to‑date gains, while the broader market slips more than 3% amid a weakening dollar and heightened geopolitical risk. Vista Gold, a pre‑revenue gold miner, closed 2025 debt‑free, raised $42 million...
What does it all mean? Why are yields and Bitcoin higher while risk assets are down and the dollar is bid? I take you back to the correlation matrix (below). Is it all just technical or is there a larger...
If we are now about to enter a Central Bank rate rising period, it's worth considering we are in a very different place to the last rate rising period. Back a few years ago interest rates were artificially low and...
Nigeria’s oil revenues are set to surge as the Iran‑Ukraine war pushes crude above $100 a barrel, a windfall for the country’s export‑driven economy. Yet the nation still imports most refined fuels, so higher global prices translate into steeper pump...
Global bond yields continue to climb: the UK 10-year has touched 5%, while the German Bund has crossed 3% and the US stands at 4.36%. Compounding the warning signs for the global economy, this comes amid an ongoing bear flattening...
The recent Iran‑USA‑Israel escalation, highlighted by Operation Epic Fury and Iran’s closure of the Strait of Hormuz, has halted the flow of roughly 20 million barrels of oil daily, unsettling global energy markets. The disruption creates a strategic opening for Africa...
Industrial production nudged up 0.2% in February, marking a modest 1.4% year‑over‑year gain, a small but positive signal for the NBER recession gauges. Homebuilder confidence ticked higher in March yet remains historically low, with 37% of builders cutting prices. Gasoline...
Oxford Economics slashed its UK GDP growth forecast to 0.4% from 0.9%, half the OBR’s estimate. The downgrade reflects rising oil and gas prices after the Iran‑Israel conflict, which keep interest rates high and increase business costs. Analysts warn that...
InvestHK director Alpha Lau urged Hong Kong to leverage its safe‑haven reputation to attract capital fleeing the Middle East conflict, noting a shift of firms from Dubai to the city. She highlighted growing interest from Gulf high‑net‑worth individuals and sovereign...
China’s shipments of rare‑earth permanent magnets to the United States fell 22.5% year‑on‑year in January‑February 2026, marking the seventh consecutive month of decline. The US now accounts for just 9.2% of China’s magnet exports, slipping to the third‑largest buyer behind...
Container lines are scrambling to move 40,000‑50,000 TEUs that have been temporarily stored at Indian ports toward the Middle East. Nhava Sheva alone has discharged roughly 25,000 TEUs, creating a bottleneck as carriers seek shuttle capacity at Gulf gateways. Alternative...
U.S. tariffs have narrowed the trade deficit with China from roughly $290 billion to $202 billion, while shifting import volumes toward Vietnam, Taiwan, India and Mexico. The policy has spurred “origin‑washing,” where Chinese goods are mislabeled to evade duties, complicating enforcement. Manufacturing...
On March 20 2026 the Central Bank of Russia trimmed its benchmark rate by 50 basis points to 15.0%, the seventh reduction since the October 2024 peak of 21%. The cumulative easing amounts to six percentage points, the deepest policy shift in over two...
Iranian oil has been sanctioned for many years. The 140 million barrels he is referring to are part of the "dark fleet" that has been shipping Iranian oil to Asia (mainly China) for years. Iran gets money for oil, and...
🚨 THE MARKET IS ONE ISLAND AWAY FROM RELIEF AND CHAOS US is quietly considering lifting Iran sanctions but behind the scenes? There's talk of something far more aggressive. And it all comes down to one tiny island in the Persian Gulf...
Recent coverage underscores a convergence of fiscal and energy pressures in both the United States and Australia. In the U.S., the national debt has breached $39 trillion, while President Trump’s hard‑line stance on Iran and rising oil prices are being linked...
Recent U.S., Israeli, and Iranian strikes on Middle East oil and gas infrastructure have sharply lifted European natural‑gas prices. Because gas‑fired plants often set marginal electricity rates, merchant power prices across Europe are expected to rise in the near term....
The International Monetary Fund warned that oil and gas prices staying above $100 a barrel for a year could add 40 basis points to global inflation and trim output by up to 0.2%. The alert follows Brent and WTI breaching...
China’s imports of discounted Russian crude surged to 21.8 million tonnes in January‑February 2026, a 40.9% year‑on‑year increase, while the dollar value rose only 5.8% due to steep discounts. Russian oil now makes up more than one‑fifth of China’s total crude...
Malaysia announced it is terminating its customs agreement with the United States after a Supreme Court ruling declared the IEEPA‑based tariffs illegal. The original pact imposed a flat 19% tariff on most Malaysian exports, a rate now effectively cut in...
Federal Reserve Governor Christopher Waller warned that a prolonged oil price surge could seep into core inflation, making any shock more than a transitory blip. He noted that while structural inflation is edging toward the Fed’s 2% target, tariffs are...
Fed governor Chris Waller to CNBC's Steve Liesman: I was ready to dissent for a rate cut after the February jobs report came out. But the inflation picture is looking worse and has become more of a concern because the Strait...
CHINA ALREADY GOT ITS FIRST WIN FROM THE WAR IN IRAN In today's newsletter, I wrote about how the long term trend of countries reducing their oil imports by substituting them with Chinese tech is already accelerating since the start of...
Serbia secured a U.S. Treasury waiver extending sanctions relief for the Russian‑owned Naftna Industrija Srbije (NIS) until April 17, 2026, allowing continued crude oil imports amid the war on Iran. The waiver comes as Serbia imposed a ban on crude and...
In this regime, even “safe” carries beta: welcome to the era of the risk-full rate https://t.co/8SEao6GWwp
Lotta spilled milk around what central banks should do in the face of this oil shock. But the fact is what they are mandated to do is what matters.
The Iran‑Israel conflict is spilling into global oil markets as strikes target both the Hormuz corridor and Iran’s Kharg Island export hub. U.S. officials have responded with a Jones Act waiver, Strategic Petroleum Reserve drawdowns, and the prospect of releasing...
Lower prices, lower yields, lower oil. Either that, or a new war in the Middle East. https://t.co/mnkr6zwlk9
Oh, oh. China. Rare earth exports increase. Fall to US. And the supply chains? The US-China trade deal? And the delayed Trump-Xi meeting?
I'm a big advocate for stabilization policies generally, but.... The more you try to play games to stave off fundamental price adjustments altogether, the nastier they can get as time goes by. Could end up adding more volatility than what you've...
inflation shows up on your screen much quicker than financial stability tremors and layoffs. hawk talk out of the gate is easy; hawk walk when UnE is up a percentage point and rising, not so much
Now powell and Fed will be forced to do an emergency rate cut and be late as high oil prices start slowing down economy into recession.
It'll be interesting to see how this looks over the next week, as we get more post-FOMC Fedspeak. But my proprietary measure of FOMC hawkishness climbed even further after Powell's press conference. https://t.co/lNilk5T2yz
This week we unpack just how trapped central banks are, especially single mandate central banks who are forced to hike into this shock. Shit is not great yo
The prediction markets are pushing out expectations of a US-Iran #ceasefire further and further... It's not unrelated that expectations of a #recession are creeping up at the same time... https://t.co/oFshabOLCJ
The US National Debt has now increased by $2.8 trillion since the Debt Ceiling was raised last July. The Federal Government continues to borrow from our future to spend money like drunken sailors today. Next stop: $40 trillion... https://t.co/rtXuDORPwa
Irish economy in better position than European peers on Iran war risk, Makhlouf says https://t.co/lomrlc1AAE via @livfletcher_ https://t.co/T1sVPBtbzJ
If Hormuz stays closed another 3-4 weeks, it all begins to crumble...into an already-teetering global sovereign debt problem & consumer credit problem. Based on what I'm hearing, it is highly likely Hormuz will remain closed for at least another 3-4 weeks. Let's...
Price is set on the margin. One underappreciated problem n today's global fixed income markets is that the biggest participants (bank, insco, pension) are indifferent among G10 sovereigns. Local problems relatively small market like UK Gilts can then force global...
Wars can move markets in the short run, as they are today. But over the long run, stock returns are driven by economic growth and corporate earnings. Since 1941 the world has seen almost constant conflict. And yet, $1 in the S&P 500...
It's not just a blip. Increasingly oil futures markets are suggesting that the Iran war is going to have (or has already had) effects that will last for years. https://t.co/j23M3zH7AL
The reason the Dollar isn't stronger is because markets price a much more hawkish policy shift by central banks in the G10 compared to the Fed. That's moving rate differentials against the Dollar and tempering what otherwise would be an...
Waller having his own personal Trichet moment: "oil can bleed through to core inflation at some point"
Reupping this as the continued Hormuz chaos seems increasingly likely to drive oil above $200/barrel, followed by years of hydrocarbon market chaos
There is nothing more idiotic than raising interest rates because a strait with oil is closed.
