Kicking the can on Iran, dovish hold from the BoE
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How might US involvement in the Iran conflict affect oil prices?
Well, no big moves over Iran today. Brent is up again, but generally markets are a bit more circumspect. Firstly, because the US is on holiday, and secondly, a White House spokesperson has said that the President will make a decision about joining the war within two weeks. So it is not imminent and maybe it can be negotiated away. We'll see. Uh the Bank of England kept rates on hold, but perhaps a little more devish than expected. Three voted for a cut, and we'll look at Australia's employment numbers from yesterday. It's Friday, it's the twentieth of june twenty twenty five. It's the morning call from Nav. Good morning. Well a small move down in the US dollar on the DXY this morning, a tiny movement up for the euro, but the Aussie down half percent to sixty four point seven US cents.
The yen is down a quarter percent, the pound is up naught point three percent. Equities, well, markets closed in the US for Juneteenth holiday, but in Europe the Eurostocks fifty closed down one point three percent, naught point six percent lower for the FTSE one hundred and one point one percent off the DAX. Ten year guilt yields are up four base. Basis points this morning in the UK, up six in France, two in Germany. Aussie ten years yesterday were at four point two one percent, falling four basis points yesterday. Now on futures, they're closer to four and a quarter percent. Uh Treasury is not trading for the aforementioned holiday, and oil, well up again. Uh WTI is up naught point nine percent, Brent is up another two point eight per cent, not far off seventy-nine a barrel now.
We were talking about oil perhaps uh averaging sixty dollars not so long ago. In fact, even now JP Morgan are predicting that oil will get around that level by the end of this year. So perhaps it's all going to be a short term lift in prices. Uh Nab's Gavin Friend is with me today uh from London. So let's kick off. Uh simulation there with the Bank of England. Rates on hold today at four and a quarter percent, uh a six three vote to hold. David Ramsden uh joining those who are wanting a cut.
Mm.
What did the latest market data show for currencies and equities?
Morning, Phil. Yes, indeed. Uh so look, you know, the market, I think economists, uh, market pricing, NAB, we were all looking for a sort of a seven two on hold vote uh with the two doves. Um Swaty Dingra and Alan uh Taylor who voted for fifty basis points, remember, at the May meeting against the consensus of a twenty five cut. No surprise that they continue to look for a cut and You know, because the bank has got a pattern of cutting in the months where it has its forecast meeting uh forecast revision, so February, May, August and November, what tends to happen is the doves will call consistently for twenty five every at every meeting and then when the MPC, you know, uh uh i i in sum goes for a twenty five cut, they'll they'll raise that to fifty.
So it was no no no No surprise that these two, you know.
um pulled in the wrong. But was Ramsdon that much of a surprise? Because 'cause he's been sort of like early in, you know, in calling for for cuts as well in the past, hasn't he? Dave Ramsden, yes. Yes. I mean
he he um w actually when they first kicked off the uh the the easing cycle, which was in August twenty four, he wanted to cut in May. And then when they cut in November, he wanted to cut again in December. So he's got a form. Mm There's no doubt about that. But I think this is important because remember, in May we had that fairly chaotic messaging where you get a twenty five cut, five members wanted to cut uh twenty five, two wanted to cut fifty, but two, the Hawks, uh Hugh Pill and uh Catherine Mann wanted the rates on hold. And the strange thing was Catherine Mann had previously been voting for or calling for fifty basis points. And and quite correctly the market didn't quite So I think what we get today now is a bit of clarity.
Rams then shift clears things through, and actually we think it's important signalling because it it it it it kind of then gives the market it tees the market up for thinking the next cut at the August meeting, alongside new forecasts, is back on track.
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Chapters
8 chapters
1
How might US involvement in the Iran conflict affect oil prices?
0:01–1:52
2
What did the latest market data show for currencies and equities?
1:52–4:16
3
Why are UK and European bond yields rising?
4:16–6:44
4
What are the forecasts for Brent oil reaching $60 by year‑end?
6:44–8:14
5
What did the Bank of England’s minutes reveal about future rate cuts?
8:14–10:30
6
How is the UK labour market softening and what does it mean for inflation?
10:30–12:30
7
Why did the Swiss National Bank and Norges Bank cut rates and what’s next?
12:30–15:03
8
What do Australia’s unemployment figures and New Zealand’s GDP tell us about the region’s economy?
15:03–16:45