Fed says, ‘don’t worry’.
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Why is the Fed holding rates steady despite higher oil prices and geopolitical risks?
Oil is higher today as uncertainty around the Gulf continues with more missiles, more rhetoric, and no more ships passing through the strait. But the Fed is looking through it all. A very dovish hold sees a more united Fed. But they're still calling for one more cut despite inflation concerns. And they've up their GDP forecast as well. How come? What's changed? AI, perhaps? It's Thursday, it's the 19th of March, 2026. It's the morning call from NAB. Good morning. Well, when it comes to the impact of the Iran war, every day is different, it seems. So today Brent Crude is up five percent, edging towards one hundred and nine a barrel. We've also got a two point one percent rise in WTI and gas at the Dutch T T F market is up five percent as well today.
Shares are well down, not point eight percent off the Nasdaq and the S P, almost one percent off the FTSE one hundred and the DAX. The US dollar is up a third of one percent, the Aussie is down naught point four percent. Euro and the Yen are down naught point three per cent and bond yields are rising again, up four basis points for UK ten years, up three for ten year treasuries, uh anywhere between three and seven across Europe. Aussie ten years were down four basis points yesterday to four point eight nine percent, uh, but almost four point nine seven percent this morning. So that's a a seven or eight percent lift in yields overnight on futures. And Nab's Gavin Friend is here today. Uh so look, the Fed has just happened, rates on hold, we'll talk about that in a moment.
This price movement though, uh, it was all before the Fed and it's all related to the Gulf. So South Pars, which is an oil and gas refinery that provides domestic gas supplies within Iran. This is a massive uh oil and gas field. Uh it's been hit by missile, also supplies to Iraq as well. It's been hit by missiles, and Iran has basically responded saying we're gonna strike other energy facilities now in the region. Uh you've started Down that road. So Saudi Arabia, UAE, look out. Uh and oil is up because, you know, I think there are fears that this is another escalation point in this war.
How is the recent missile strike on Iran’s South Pars refinery affecting global oil markets?
Well, it certainly is. Good morning.
Phil. I mean, this would mark to your point the first time, if confirmed, that uh the US and Israel have attacked Iran's upstream oil and gas facilities. So um they've come out uh adding to the the the threat that's been there for the last uh eighteen days, uh the leverage they have, of course, uh you know, is in is in the Strait of Hormuz. They've been using that. very effectively. And now they're saying, well, if you want to go after that kind of stuff, we'll just uh widen our attacks on uh regional oil and gas facility infrastructure facilities. Um obviously nobody wants to see that because you know we talked about this before the threat that it's all very well to talk about the threat of the Strait of Hormuz and when we can when can we get safe passage back through that.
But if we start destroying regional regional infrastructure, the the problem becomes much bigger, much longer potentially to to to rebuild. Uh nobody wants that. So even even if I mean it's if it's it's an understandable tactic, isn't it, from from Iran to to to go for this because it's leverage and they'll they'll they'll try and therefore use that as the leverage to say, well you you know what you need to do if you want us to stop doing this. There will be a lot of intra regional pressure, de escalation from Iman and Saudi Arabia, Kuwait and others, but uh, you know, uh i Iran will just turn around and just say What do you expect us to do? You know, you you know what you need to do. Perhaps you can talk to the US or Israel on me.
Israel on the thing.
So that they basically scatter into smaller bomlets, which uh allows them to break through on the the the shield uh into i in into Israel. So all of that the fact that they've still got this capability to do this uh means this is Isn't a war that's uh gonna end this week or next week. And i and if as a result of this, even if we don't have a tax on uh energy production facilities, just the mere fact that, you know, uh b facilities are having to be closed down because there's just not the ability to ship out, uh they're gonna take a while to get back up again.
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Chapters
8 chapters
1
Why is the Fed holding rates steady despite higher oil prices and geopolitical risks?
0:01–1:57
2
How is the recent missile strike on Iran’s South Pars refinery affecting global oil markets?
1:57–4:48
3
What do the latest Producer Price Index numbers reveal about underlying inflation pressures?
4:48–7:02
4
Why has the Fed upgraded its US GDP and inflation forecasts while still signaling a rate cut?
7:02–9:10
5
How are other central banks—Bank of Canada, Bank of England, and ECB—reacting to the same energy shock?
9:10–11:23
6
What are the implications of the ECB’s latest inflation data for future rate moves in Europe?
11:23–14:51
7
How are Australian employment figures and labour‑market tightness influencing RBA policy outlook?
14:51–16:59
8
What should investors watch for next as the Fed, BOE and ECB navigate the war‑driven uncertainty?
16:59–19:25