Markets stabilised overnight, despite military actions in the Middle East, as communications between the adversaries continue. There is hope for a reinstatement of the ceasefire. Oil prices stabilised around US$82/barrel, while global bond yields spiked. The UK selected a new PM, but markets lacked enthusiasm, as UK 10-year gilt yields topped 5%. This is a level where bells are ringing, so watch this space. The US Dollar was steady, with the EUR holding 1.1400, while the GBP trades above 1.3400.Commodity currencies stabilised, with the AUD looking to regain 0.7000, while the NZD trades around 0.5850. NZ’s infrequent release of inflation data continues today with the latest quarterly release of the CPI, expected to show a big jump. Inflation is expected to surge back towards 4%, explaining the RBNZ’s last pre-emptive strike. The result could engender some volatility during domestic trading.
