Paying the price of war
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Why are oil prices spiking amid US‑Iran tensions?
Well, oil prices are higher again as the US and Iran tit for tap measures pick up a pace. US inflation is rising, but second round effects uh aren't as evident just yet, but seen as a bigger problem in Europe where the ECB is expected to lift rates today. And China hit between rising producer prices and falling consumer prices. Not good to be in the middle of that. It's Thursday, it's the eleventh of June twenty twenty six. It's the morning call from NAB. Good morning. Well, the US dollar has had its ups and downs, but it's where it was yesterday on the DXY, whereas the Aussie dollar is down a quarter per cent to about seventy point one US cents. US stocks have fallen sharply, down one point six percent off the Nasdaq, uh down one percent for the S P and down one percent for the DAX in Germany as well.
Bond yields are higher, up two basis points for ten year treasuries, up three in Germany and the UK. Uh we've got higher lifts in yields in other parts of Europe. Aussie ten years were down. The three basis points yesterday, uh to four point eight nine percent, uh now closer to four point nine one this morning on futures, and oil is up two point four percent higher for WTI. Brent is up around two percent, over ninety-three a barrel now. Big moves in gold as well, uh, which we'll touch on today. Nab Sky Masters is with me uh this morning. So, Sky, the ceasefire between the US and Iran isn't much of a ceasefire anymore. Donald Trump said yesterday. Okay. Because we've had all of these tit for tat measures.
Uh we hit them hard yesterday, said and we're gonna hit them hard again today. So I mean markets are it has impacted oil.
How is the US‑Iran “tit‑for‑tat” affecting global markets?
Not a huge amount, but markets obviously looking at this being a long path to peace. So elevated oil prices for longer, and we're seeing that not just in oil, but in equities, in rising bond yields as well. Um in a way it's sort sort of more of the same, but you know, the less room for optimism, I guess.
Good morning, Phil. Uh yeah, look it is really more of the same. Um, I do find it amusing when you say talk about the ceasefire. Have we really had a had a ceasefire? I d I don't think we have. So Price action overnight uh just shows the market, particularly the oil price, does continue to To react to to the comments that come out of Trump and the news reports around any action between Iran and the US. And so as you said, Trump was out over overnight criticizing Iran for taking too long to negotiate the end of the conflict. And he was also threatening that the US would strike Iran again. Um and meanwhile there were reports that US forces had attacked sites near the Strait of Humus while Iran had launched a drone strike on the US Fifth Fleet in in Behran.
So ceasefire? No, don't think so. Um and as you said the oil price has lifted higher. I think as I look at it now, it it is off the um intraday highs. I think Brent got to to ninety four um dollars a barrel.
What is driving the sharp decline in gold prices today?
That's uh so that was up around three percent, whereas it's currently at just back below n ninety four and and up to two percent on the day. But yeah, the main The main news going in or or overnight really has been the move in oil, which is in contrast to I think what investors probably went into today thinking they'd be looking at and reacting to being the US CPI print, which we will unpack in a minute, I'm sure.
We will. Or in less than a minute. The other in the other interesting thing is gold, because it's lost its shine quite a bit as well. I mean, it's normally times of uncertainty, of course, people pile into gold, but I guess bond yields are high, inflation's chipping away at it. Gold isn't quite so attractive. So gold is down three point eight percent a day. So that's really tender and Yeah,
it has. It has. So as you said, a big move lower in in gold. It's down around I've got twenty percent um below the levels seen prior to the Iran war. And I think so it's breaking its it's just broken below its two hundred day moving average. What caused the big move overnight, uh it's it's unclear o obviously. I think the higher inflation and the repricing on the Fed, where the market is now expecting the Fed to tighten, has probably weighed on gold.
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Chapters
8 chapters
1
Why are oil prices spiking amid US‑Iran tensions?
0:01–1:30
2
How is the US‑Iran “tit‑for‑tat” affecting global markets?
1:30–2:55
3
What is driving the sharp decline in gold prices today?
2:55–4:24
4
Why did the US headline CPI hit 4.2% while core inflation eased?
4:24–6:02
5
Will the ECB raise rates today to curb second‑round oil effects?
6:02–7:44
6
How is the Bank of Canada responding to mixed inflation and growth data?
7:44–9:14
7
What explains China’s low consumer inflation but rising producer prices?
9:14–11:06
8
What are the market expectations for Fed tightening after today’s data?
11:06–13:09