Risk appetite rises, but why?
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Why is global risk appetite rising despite ongoing Middle‑East conflict?
So risk appetite has been rising, it shares up, the Aussie dollar up, yields falling. But why? I mean, nothing at all has changed in the Middle East. The Aussie and Kiwi dollars though are much stronger as a result. Meanwhile, life goes on, central banks still meet and the RBA is still expected to lift rates today. China came out with surprisingly strong numbers yesterday, particularly for fixed asset investment. But really, that Risk appetite, could it all reverse today? There's every chance, isn't there? Because nothing has changed in the Middle East. It's Tuesday, it's the seventeenth of March twenty twenty six. It's the morning call from Nab. Good morning. Well, oil is moving down, a four point two percent drop in WTI and almost two percent off Brent, but it's still at a hundred and one dollars a barrel.
The US dollar is down half percent, which has uh helped the Aussie push up by one point one percent, up to seventy point six uh US cents. That's the biggest rise of the majors by far this morning. Shares are pushing higher, one point four percent up for the Nasdaq, one point one percent for the SP. In Europe, the The DAX is up half a percent, so is the FTSE 100. Bond yields are down as well, four basis points off 10-year Treasuries to 4.3%, down six basis points in the UK, France, and Italy, down three in Germany.
What caused the overnight fall in yields and the Aussie dollar’s strength?
Aussie 10 years uh were up five basis points yesterday, but they are down overnight and uh down to five percent, uh, which is where they are now for the uh for the yield on ten years. So uh let's start on that. Yeah, with NAB Sky Masters in Sydney. So yields heading down just about everywhere. Um and um look with you know, everything else is saying that risk appetite is on the rise. But for why?
Yeah, good morning. Good morning, Phil. It it is um you know, it it is quite or still quite volatile in in financial markets and you know, strangely enough, overnight sort of markets are reflecting a bit of a mild positive um risk sentiment tone. Um and on the back of that you have seen that that rally in in bond yields uh overnight. Um Pretty much led uh by European and and guilt yields, but I think you're getting a little bit of a catch-up this morning in um in treasuries and and Aussie Aussie futures. So, you know, what what's driving that improvement in risk sentiment where you've got you're also seeing stock market stock markets are are up and the US dollar is is weaker. Uh it's just really hope.
Hope about about oil tankers being able to traverse through the Strait of Humus. Um so so I really would say that nothing meaningful has really really changed. It's just a bit of the news flow that's come out overnight that that has sort of raised that that hope or optimism that the supply of oil um Mm.
How did oil price movements and tanker‑routing hopes influence market sentiment?
will will um start start to to increase the Well the
IEA has said that they've only used twenty percent of reserves, or this latest batch would only use twenty percent of reserves, so they can always release more. Uh but otherwise, I mean Donald Trump has been singularly unsuccessful in trying to get other nations to help him with the uh the idea of escorting vessels through the Straits of Hormuz and that hasn't even started yet. So I mean what has changed really?
No, no, no. Look, I really can't make a whole lot of sense around um around the price action overnight. Um, you know, if I look at the the news reports, you know, there was a report of that Pakistani flagged oil tank that went through the strait on Sunday and You know, a couple of other LBG tankers. There are reports that India's talking to, you know, Iran to ensure passage fits six tankers. You've had the IEA come out and say that they could release more emergency reserves if if needed. But really that that is all. President Trump has called on nations to support the safe passage of tankers through the strait, but overnight there's been reports that Germany many UK, France and Jap Japan have have d dismissed this request.
Um And you know, the UK is saying that they don't want to be drawn into a wider a wider a wider war.
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Chapters
8 chapters
1
Why is global risk appetite rising despite ongoing Middle‑East conflict?
0:01–1:17
2
What caused the overnight fall in yields and the Aussie dollar’s strength?
1:17–2:52
3
How did oil price movements and tanker‑routing hopes influence market sentiment?
2:52–4:44
4
What are the expectations for today’s RBA meeting and a possible rate hike?
4:44–6:04
5
Why did China’s latest economic data surprise analysts and what does it mean for risk sentiment?
6:04–7:45
6
How are Canada’s CPI and US industrial production data affecting global inflation outlook?
7:45–9:37
7
Why are the Aussie and Kiwi dollars outperforming other G‑10 currencies today?
9:37–11:43
8
What could cause today’s risk‑appetite rally to reverse and what should listeners watch for?
11:43–12:34