- Container ship damaged off UAE, hit by suspected projectile near Strait of Hormuz
- Westpac lifts RBA peak rate forecast to 4.35%, sees RBA hiking rates in March and May
- Australian bank analysts are piling on to forecast an RBA rate hike next week
- Weak yen and oil shock cloud Japan inflation outlook -- PPI recap
- PBOC sets USD/ CNY central rate at 6.8917 (vs. estimate at 6.8824)
- Goldman Sachs February CPI preview signals gradual inflation slowdown, not everyone agrees
- The IEA is weighing a record oil reserve release to calm markets after Hormuz disruption
- Japanese wholesale prices +2.0% y/y in February (2.1% expected)
- ICYMI: Debate grows over political influence on Bank of Japan policy
- ICYMI: RBA’s Hauser warns oil price risks could intensify rate rise debate (March 17 live)
- US destroys 16 Iranian mine vessels and warns over Strait of Hormuz, more detail
- Trump thanks India Reliance for investment in new Texas refinery project
- G7 to discuss energy coordination as Mid East tensions lift oil prices: 1400 GMT Wednesday
- North Korea tests cruise missile for destroyer and backs Iran (KJU attention seeking)
- Lagarde says eurozone not in stagflation as ECB keeps rate path uncertain
- US stocks mixed. NASDAQ closes marginally higher. The S&P marginally lower.
- investingLive Americas market news wrap: A complete mess in oil. Other markets tune out
- Oracle beats Q3 estimates as cloud revenue growth drives $90B outlook (shares jump)
Summary:
Oil markets remained in focus as the U.S. said it eliminated 16 Iranian mine-laying vessels near the Strait of Hormuz.
A Wall Street Journal report said the IEA has proposed the largest-ever release of strategic oil reserves, with countries to decide today.
The G7 will meet at 1400 GMT to discuss energy coordination amid the Middle East conflict.
Japan signalled it could release oil reserves independently if needed, while February PPI data came in softer.
RBA Deputy Governor Andrew Hauser’s hawkish remarks yesterday triggered a wave of forecasts for a March 17 rate hike.
AUD/USD rose to levels last seen in mid-2022, while Asian equities rallied, with the Nikkei above 55,500.
Oil markets remained a key focus during the Asia session as developments around the Strait of Hormuz and emergency energy policy discussions helped drive sentiment.
The U.S. military said it had eliminated 16 Iranian mine-laying vessels near the Strait of Hormuz, highlighting the security risks facing one of the world’s most important oil shipping routes. A Wall Street Journal report said the International Energy Agency has proposed the largest-ever coordinated release of strategic oil reserves to help stabilise crude prices. Countries are expected to decide later today whether to proceed with the release.
Energy security will also be on the agenda at the G7 meeting scheduled for 1400 GMT, where leaders are set to discuss potential coordination measures. Oil prices have eased somewhat following these developments.
Central bank developments also drew attention in the region. RBA Deputy Governor Andrew Hauser delivered remarks on a podcast Tuesday that were interpreted as notably hawkish just one week ahead of the next Reserve Bank policy meeting. His comments have prompted a cascade of analyst forecasts for a March 17 rate hike.
Westpac, NAB, Citi and Deutsche Bank now expect the RBA to raise rates in both March and May, while Bank of America, UBS and Capital Economics forecast a hike at next week’s meeting. The shift in expectations helped push AUD/USD to levels last seen in mid-2022.
In Japan, Trade Minister Akazawa said the government could release oil reserves independently if necessary and would not rule out any measures to ensure energy stability. Japan also released February producer price data, which showed a modest easing in wholesale inflation y/y and a surprise monthly deflation, supporting expectations for the Bank of Japan to hold off on policy normalisation at next week’s meeting.
Regional equities were firm. China’s new energy sector climbed more than 3%, while Japan’s Nikkei rose over 2%, trading above the 55,500 level.
