Brent crude paused its rally to settle around $104 a barrel on Friday after Iranian state media said Tehran would meet Gulf states in Oman to discuss the Strait of Hormuz. Gulf Cooperation Council diplomats are expected to meet their Iranian counterpart on Monday to discuss a possible temporary arrangement for managing shipping through the strait. Adding to downward pressure, the EIA raised its 2027 US crude production forecast to 14.3 million barrels a day, while the IEA sharply cut its global oil demand outlook, forecasting a 2.5 million-barrel-a-day contraction in 2026. Meanwhile, China is on track to import roughly the same volume of crude in September as in August, with purchases recovering from June’s decade-low. Saudi Arabia shut its East-West crude pipeline as a precaution after multiple attacks, while Iran-backed Houthis reportedly advanced to Yemen’s Perim Island. Brent surged 9% on the week.

Brent Rally Pauses on Mideast Diplomatic Efforts

Crude oil paused its rally to settle around $100 a barrel on Friday after Iranian state media said Tehran would meet Gulf states in Oman to discuss the Strait of Hormuz. Gulf Cooperation Council diplomats are expected to meet their Iranian counterpart on Monday to discuss a possible temporary arrangement for managing shipping through the strait. Adding to downward pressure, the EIA raised its 2027 US crude production forecast to 14.3 million barrels a day, while the IEA sharply cut its global oil demand outlook, forecasting a 2.5 million-barrel-a-day contraction in 2026. Meanwhile, China is on track to import roughly the same volume of crude in September as in August, with purchases recovering from June’s decade-low. Saudi Arabia shut its East-West crude pipeline as a precaution after multiple attacks, while Iran-backed Houthis reportedly advanced to Yemen’s Perim Island. Oil surged 9.7% on the week.

Oil Rally Pauses on Mideast Diplomatic Efforts

The Ibovespa fell 0.6% to close at 187,207 on Friday as the Supreme Court crisis continued to fuel political uncertainty, weighing on the country’s economic outlook. Chief Justice Edson Fachin ordered Justice André Mendonça to remove, within 24 hours, the secrecy surrounding proceedings related to investigations into Banco Master. This includes possible irregularities involving the financing of the film “Dark Horse,” which could affect Flávio Bolsonaro’s electoral prospects. Markets view Bolsonaro as more fiscally restrictive, while elevated domestic yields and weak business activity continue to weigh on the economic outlook. State-controlled financial stocks traded lower, with Banco do Brasil down 1.4%, BB Seguridade shedding 4.1%, and Caixa losing 2.4%. Utilities also posted losses, with Axia down 1.6%. CSN plunged 7.4% as investors booked profits, with the stock still up 4.2% on the week following a CEO change. The Ibovespa rose 1.1% on a weekly basis.

Ibovespa Falls as Political Risks Persist

The S&P/TSX Composite Index rose 0.5% to close at 35,697 on Friday as oil prices pulled back on prospects for diplomatic efforts to ease tensions around the Strait of Hormuz. Gulf foreign ministers are expected to meet their Iranian counterpart in Oman on Monday as part of efforts to secure support for a temporary arrangement to manage shipping through the strait. The pause in the oil rally allowed equities to enjoy some respite. Credit-sensitive stocks posted gains, with TD Bank and BMO up 0.8% each, while Scotiabank added 0.9%. Gold prices rebounded, supporting heavyweight mining stocks, with Agnico Eagle rising 2.2%, while WPM and Franco-Nevada gained 2.4% each. Tech stocks advanced, tracking strength in US hyperscalers and chipmakers, with Shopify up 1.9%, Constellation Software adding 2.5%, and Celestica jumping 6.6%. Descartes Systems surged 6.9% after reporting second-quarter revenue slightly above estimates. Still, the S&P/TSX Composite Index lost 1.7% on a weekly basis.

TSX Gains as Oil Rally Pauses

The Dow Jones Index gained 509 points or 0.98 percent on Friday to close at 52573 points. Gains were led by Cisco Systems (4.38%), IBM (3.89%) and Boeing (2.77%). Biggest losers were UnitedHealth (-2.47%), Amgen (-1.34%) and Merck (-0.47%).

The Dow Jones Index Closes 0.98% Higher

US stock indices closed higher on Friday, halting four sessions of losses as oil prices and Treasury yields paused their surge. The S&P 500 gained 0.9%, the Dow added 509 points, and the Nasdaq rose 0.9%. Long-dated Treasury yields eased from multi-year highs as fuel prices refrained from extending this week’s rally, which was fueled by a wave of strikes between the US and Iran in the Persian Gulf. High energy prices were expected to worsen an already elevated inflation outlook, with headline inflation at 3.4% in August, reinforcing bets that the Fed will raise rates on Wednesday. Credit-sensitive sectors gained as the oil rally paused, with Alphabet up 1.8% and Amazon adding 1.9%, while JPMorgan rose 0.8%. Oracle erased earlier gains, down 1.8% despite reporting strong results. Chipmakers gained, with AMD up 2.5% and Intel up 2.6%. Dell surged 11.9% to all-time high on RBC Outperform initiation. On the week, the S&P 500 lost 0.6%, the Nasdaq fell 0.7%, and the Dow shed 426 points.

Wall Street Ends Four-Day Losing Streak

Uruguay’s industrial production rose 4.2% year over year in July 2026, following a 5.4% increase in June. The growth was driven primarily by a 10.5% rise in food products manufacturing, followed by pharmaceutical products, which increased 7.0%, and paper and paper products, which rose 6.4%. The division with the largest negative contribution to the year-over-year change in industrial output was beverage manufacturing, which slumped 32.4%. Meanwhile, the Index of Hours Worked by Workers increased 2.6%, while the Employment Index declined 0.1%. On a monthly basis, industrial production fell 1.0% in July.

Uruguay Industrial Production Slows in July

The US government posted a $167 billion budget deficit in August 2026, narrowing from a $345 billion shortfall a year earlier and well below forecasts for a $404 billion gap. Government outlays fell to $527 billion from $689 billion. Social Security ($141 billion), net interest ($86 billion), health ($81 billion) and national defense ($72 billion) accounted for the largest expenditures. Meanwhile, government receipts rose to $360 billion from $344 billion, led by individual income taxes ($179 billion) and social insurance and retirement receipts ($141 billion). The cumulative deficit for fiscal year 2026 reached $1.966 trillion through August.

US Budget Deficit Narrows in August

Paraguay’s trade balance swung to a deficit of $50.84 million in August 2026, from a $25.12 million surplus a year earlier. Imports surged 21.1% year over year to $1.85 billion. Purchases of consumer goods grew 13.1%, imports of intermediate goods rose 23%, and capital goods purchases increased 24.9%. Meanwhile, exports increased 15.9% to $1.80 billion. Sales of manufactured goods of agricultural and livestock origin rose 8.6%, while exports of industrial manufactured goods jumped 23.6% and sales of fuels and energy increased 13.9%. In contrast, exports of primary products fell 2.1%.

Paraguay Trade Balance Swings to Deficit

The potential for constructive dialogue regarding tanker flows between the GCC and Iran next week halted the surge in oil and gas prices at a time that financial markets fret over the inflationary outlook. Outcomes will impact global borrowing costs as the Federal Reserve sets interest rates. For economic data, the US will release retail sales, trade terms, and industrial production. Monetary policy announcements are also taking the spotlight in the UK and Japan. A busy week of data in the UK features its inflation, wages, and retail sales, while Germany publish its ZEW confidence indicator and the Euro Area will post its goods trade and industrial production. A series of key data for China includes industrial production, retail sales, unemployment, housing prices, and credit aggregates. Lastly, BRICS nations are due to meet.

Week Ahead - Sep 14th

The Mexican peso strengthened to near 16.98 per US dollar, remaining close to the more than two-year high of 16.91 touched on September 4th, as Mexico’s industrial production rose 2.7% yearly in July 2026, the highest level since April 2024 and above expectations of a 1.8% gain. Gross fixed investment also rose 7.7% in June, beating expectations for a 4.8% increase. In its latest decision to keep the key interest rate unchanged at 6.50%, Banxico highlighted that the economy rebounded in 2Q26. This could support a more hawkish stance and attract higher foreign capital inflows through exports. Meanwhile, the dollar found support on expectations that the Federal Reserve could raise interest rates in September. Core US CPI increased slightly more than expected from the previous month, while headline inflation remained elevated amid higher energy costs. A Fed rate hike would narrow the US-Mexico interest-rate differential.

Mexican Peso Supported by Strong Economic Data

Cotton prices traded near 87 cents per pound, remaining around the same level after easing from a more than two-month high, as traders locked in profits and assessed demand and supply conditions. The latest WASDE report showed that the demand outlook remained unchanged, while production forecasts were revised 3% lower. Additionally, for the week ending September 8th, crop conditions worsened, with only 34% of US cotton crops rated good or excellent. The El Niño phenomenon is expected to persist through February 2027, potentially affecting crops across key producing regions. In India, below-average monsoon rainfall remains a concern after August precipitation came in 16% below normal, particularly as nearly half of the country’s farmland lacks irrigation. In contrast, the USDA’s weekly export sales report showed shipments of 73.9 hundred, rebounding after two consecutive weeks of declines.

Cotton Holds Steady

European stocks closed higher on Friday as energy prices eased off their peaks and halted the surge in long-term sovereign yields. The Euro STOXX 50 gained 0.8% to 6,323 and the STOXX Europe 600 added 0.5% to 639.1. GCC officials announced new efforts to meet with Iranian counterparts next week and discuss possibilities of corridors for tankers in the Persian Gulf. Banks and industrial surged as the pullback in energy prices and borrowing costs softened the tightening margins in their respective sectors. Santander, BBVA, and UniCredit jumped nearly 2% each, while Siemens and Safra added 2.5%. Meanwhile, Intesa Sanpaolo rose 2.6% as Rome stated it would refrain from interfering in the lender's takeover bid for Banca MPS. Tech stocks also advanced, with Infineon surging 5% Still, the STOXX 50 fell 1% and the STOXX 600 dropped 1.6% on the week on broader concerns of macro headwinds from higher energy prices and rates. The ECB hiked its rates yesterday, and markets price more tightening.

European Stocks Rebound

Russia's annual inflation rate rose to 6.3% in August 2026, its highest level since November of 2025, up from 6% in the previous month and matching markets expectations. Food inflation rose to 5% from 4.4% while non-food cost growth also inched higher to 6.5% from 6.4%. Motor gasoline inflation slowed to 24.6% from 25.9%, although remaining elevated as Ukrainian attacks on Russian energy infrastructure hampered its refining capacity. In turn, inflation for passanger transports rose further to 10.7% from 9.1% in the prior month, while services inflation edged up to 7.9% from 7.8%. Core inflation also rose to 5.4% from 5.2%, reaching its highest level in seven months. Meanwhile, inflation for utilities remained largely unchanged at 1.6%. Compared to the previous month, consumer prices fell 0.1%, reversing a 0.5% rise in the prior month.

Russia Inflation Rate Rises as Expected

The CAC 40 rose 0.8% to close at 8,180 on Friday, rebounding from two straight sessions of losses as oil prices pulled back. Prospects for diplomatic efforts to ease tensions around the Strait of Hormuz dragged crude prices lower. Gulf foreign ministers are expected to meet their Iranian counterpart in Oman on Monday as part of efforts to secure support for a temporary arrangement to manage shipping through the strait. The halt in the surge in energy prices allowed equities to enjoy some respite. Luxury stocks closed mostly higher as risk aversion eased, with LVMH adding 2.2%, L’Oréal up 1.1% and Kering rising 1.9%. Industrials also posted gains across multiple subsectors, with Airbus up 1.8%, Safran rising 2.5%, Schneider Electric adding 1.3%, STMicroelectronics gaining 2.4% and Stellantis advancing 3.1%. Financials also moved higher, with BNP Paribas and Société Générale each up 1.1%. Despite Friday’s rebound, the CAC 40 lost 1.4% on the week.

CAC 40 Rises as Oil Prices Ease

The FTSE MIB Index gained 705 points or 1.36 percent on Friday to close at 52512 points. Gains were led by Avio (3.89%), Moncler (3.00%) and Prysmian (2.63%).

The FTSE MIB Index Closes 1.36% Higher

The DAX Index went up by 207 points or 0.82 percent on Friday to close at 25569 points. The rise was led by Infineon (4.78%), Siemens (2.73%) and Deutsche Telekom (2.55%). On the downside, the weakerst performers were Rheinmetall (-3.05%), BASF (-2.83%) and Henkel (-1.71%).

The DAX Index Closes 0.82% Higher

The CAC 40 Index rose 61 points or 0.75 percent on Friday to close at 8178 points. Leading the gains are Stellantis NV (2.74%), Safran (2.67%) and STMicroelectronics (2.21%). Top losers were Carrefour (-1.48%), ENGIE (-1.32%) and Edenred (-1.13%).

The CAC 40 Index Closes 0.75% Higher

The FTSE MIB rose 1.4% to 52,512 on Friday, amid broad-based gains across sectors, while bank merger talks remained in focus. Financials outperformed after the Antitrust Authority stated it would launch an in-depth investigation into the MPS divestment between Intesa Sanpaolo (2.6%) and Unipol (0.2%). Additionally, Prime Minister Meloni stated the state will refrain from interfering in Intesa’s takeover bid for MPS (2.5%). Meanwhile, UniCredit (1.6%) CEO is set to meet the German Finance Minister on Monday to discuss a potential deal involving Commerzbank. Avio advanced 3.9% after reporting upbeat first-half profits, while Prysmian rose 3% after completing a capital increase to partially finance its acquisition of Atkore. Utilities found some respite as European gas prices declined, while Italy adopted measures aimed at boosting domestic oil and gas production to reduce its dependence on fuel imports. On the downside, Saipem (-1.2%) led the losses.

FTSE MIB Closes Sharply Higher

The FTSE 100 Index gained 36 points or 0.34 percent on Friday to close at 10645 points. Gains were led by Informa (2.04%), Howden Joinery (1.91%) and Natwest (1.73%). Biggest losers were London Stock Exchange (-2.66%), The Sage Group (-1.86%) and Burberry (-1.60%).

The FTSE 100 Index Closes 0.34% Higher

Frankfurt's DAX 40 rose further to close about 0.8% firmer at 25,557 on Friday, halting a two-day decline, helped by falling oil prices and strength in technology stocks. However, investors remained concerned about inflation and the prospect of higher rates, amid ongoing geopolitical tensions  Latest data showed US inflation remains stubbornly high due to energy price pressures stemming from the Middle East. Traders are increasingly anticipating a 25 bps rate hike next week, similar to the ECB's recent move. Infineon Technologies jumped 4.6%, benefiting from Oracle’s strong AI demand. Siemens Energy and Hochtief gained 2.1% and 1.5%, respectively. Other top performers included Siemens, Deutsche Telekom, Sccout24 and Airbus. Commerzbank rose 1.5% after the German government set conditions for UniCredit’s proposed takeover. On the flip side, BASF (-2.8%), Rheinmetall (-2.5%) and Henkel (-1.9%) emerged as the biggest laggards. For the week, the index posted a 1.9% loss.

DAX Finishes Higher, Still Posts Weekly Loss

The FTSE 100 rose 0.4% on Friday, recovering from a seven-week low reached in the previous session, after stronger-than-expected economic data boosted sentiment. UK GDP expanded 0.4% in July following 0.3% growth in June, well above economists’ expectations for no growth and marking the third consecutive month in which activity exceeded forecasts. The figures suggest the UK economy may prove more resilient than expected in the second half of 2026. Sentiment was also supported by a decline in oil prices, with Brent falling below $105 a barrel and crude slipping under $100, although prices remain elevated. In the US, stronger-than-expected core CPI reinforced expectations of a potential rate hike. Banks led gains, with HSBC Holdings up 1.4%, Barclays 1.7% and Lloyds Banking Group 1.3%, while Rolls-Royce added 1.7%. BAE Systems fell more than 1%. Despite Friday’s recovery, the FTSE 100 ended the week around 1.7% lower.

FTSE 100 Edges Up from 7-Week Low

Brent crude fell below $105 a barrel on Friday after Iranian state media reported plans for talks with Gulf states in Oman, suggesting diplomatic efforts are emerging despite a sharp escalation in tensions over the past week. Top diplomats from the six-member Gulf Cooperation Council are expected to meet their Iranian counterpart on Monday to discuss a possible temporary arrangement for managing shipping through the Strait of Hormuz. Meanwhile, the International Energy Agency sharply lowered its outlook for global oil demand, forecasting a 2.5 million-barrel-a-day contraction in 2026, the largest annual decline since the Covid-19 pandemic, as higher prices and tighter supplies weigh on consumption. The IEA warned demand could weaken further if the conflict persists, while OPEC cut its 2026 demand-growth forecast for a fifth consecutive time. Despite Friday’s decline, Brent rose for a second week as Houthi threats to Saudi Arabia continue to raise supply concerns.

Brent Pares Gains

Crude oil fell below $100 a barrel on Friday after Iranian state media reported plans for talks with Gulf states in Oman, suggesting diplomatic efforts are emerging despite a sharp escalation in tensions over the past week. Top diplomats from the six-member Gulf Cooperation Council are expected to meet their Iranian counterpart on Monday to discuss a possible temporary arrangement for managing shipping through the Strait of Hormuz. Meanwhile, the International Energy Agency sharply lowered its outlook for global oil demand, forecasting a 2.5 million-barrel-a-day contraction in 2026, the largest annual decline since the Covid-19 pandemic, as higher prices and tighter supplies weigh on consumption. The IEA warned demand could weaken further if the conflict persists, while OPEC cut its 2026 demand-growth forecast for a fifth consecutive time. Despite Friday’s decline, oil rose for a second week as Houthi threats to Saudi Arabia continue to raise supply concerns.

Oil Pares Gains

Brazil’s 10-Year government bond yield fell to around 14.24%, nearing a three-month low of 14.13% touched on September 8th, following lower-than-expected inflation data. Brazil’s annual inflation rate eased to 4.22% in August 2026 from 4.44% in July, slightly below forecasts of 4.27% and moving further within the central bank’s target range of 1.50%-4.50%. The data strengthened expectations that the BCB will cut the Selic by another 25 basis points at next week’s Copom meeting. Meanwhile, recent polls have shown Flávio Bolsonaro gaining ground in the presidential race. Markets view Bolsonaro as more fiscally restrictive, while elevated domestic yields and weak business activity continue to weigh on the economic outlook. The move gained  further momentum as the intensification of a dispute between Supreme Court justices Alexandre de Moraes, seen as a Lula ally, and André Mendonça has escalated into an institutional crisis.

Brazil 10-Year Yield Falls on Rate-Cut Bets

The Brazilian real strengthened slightly to around 5.08 per US dollar in September, reaching a more than one-month high following lower-than-expected inflation data. Brazil’s annual inflation rate eased to 4.22% in August 2026 from 4.44% in July, slightly below forecasts of 4.27% and moving further within the central bank’s target range of 1.50%-4.50%. With the Selic elevated, upward pressure on real returns on bonds is increasing the attractiveness of fixed-income market to foreign investors seeking yield. Also, lower inflation reduces the country’s risk premium, boosting foreign investor confidence. However, the data raised bets that the BCB will cut the Selic by at next week’s Copom meeting. This would narrow the rate differential, as bets on a Fed rate hike remain high following US CPI coming largely in line with forecasts. Meanwhile, gains by Flávio Bolsonaro in recent presidential election polls have supported the real, as markets view Bolsonaro as fiscally restrictive.

Brazilian Real Strengthens on Lower Inflation

Year-ahead inflation expectations in the US, measured by the University of Michigan Surveys of Consumers, climbed to 4.6% in September 2026 from 4% in August, marking the highest reading since June, according to a preliminary estimate.

US Year-Ahead Inflation Expectations at 3-Month High

The Baltic Exchange’s dry bulk freight index, which tracks rates for ships carrying dry bulk commodities, was down for a second session on Friday,  falling by 0.4% to its lowest since September 3 at 3,507 points. The capesize index, which typically transports 150,000-ton cargoes including iron ore and coal, also decreased for a second day, down 0.7% to 6,080 points; and the panamax index, which tracks vessels carrying around 60,000 to 70,000 tons of coal or grain, fell 0.1% to 2,407 points. On the other hand, the supramax index rose by 0.3% to 1,719 points. The benchmark index declined 3.3% for the week.

Baltic Dry Index Falls to Over 1-Week Low

The University of Michigan’s consumer sentiment index fell to 47.8 in early September 2026, down for a second consecutive month and well below market expectations of 51.0, according to the preliminary estimate. It was the weakest reading since May’s record low. Year-ahead expectations for personal finances and business conditions also deteriorated, as consumers anticipate greater pressure on household budgets amid rising fuel prices and trade tensions. Five-year business expectations were broadly stable but remained well below their historical average, suggesting consumers do not expect current risks to significantly worsen the longer-term outlook. Overall sentiment is now 16% below February levels, before the start of the Iran conflict, and 13% below a year ago. Year-ahead inflation expectations jumped to 4.6%, the highest since June, while five-year expectations edged up to 3.4% after holding at 3.3% for three consecutive months.

US Consumer Sentiment Falls as Inflation Expectations Rise

Germany's current account surplus widened to €21.2 billion in July 2026 compared with €10.9 billion in the same period a year earlier. The goods account surplus widened to €21 billion from €16.4 billion a year earlier, while the services deficit narrowed to €8.3 billion from €9.7 billion. In contrast, the secondary income deficit widened to €6.7 billion from €5.5 billion, while the primary income surplus narrowed slightly to €15 billion from €15.7 billion. In the first seven months of 2026, the current account surplus widened to €129 billion from €123 billion in the same period of 2026.

Germany Current Account Surplus Widens in July

The S&P/TSX Composite Index rose nearly 1% to trade close to 36,000 on Friday as oil prices pulled back on prospects for diplomatic efforts to ease tensions around the Strait of Hormuz. Gulf foreign ministers are expected to meet their Iranian counterpart in Oman on Monday as part of efforts to secure support for a temporary arrangement to manage shipping through the strait. The halt in the oil rally allowed equities to enjoy some respite. Major banks were higher, with TD Bank, BMO, Scotiabank and CIBC gaining about 1% each.  Gold prices rebounded, supporting heavyweight mining stocks, with Agnico Eagle, Franco-Nevada and WPM rising more than 2.5%, while Barrick gained more than 2%. Copper rebounded after its decline on Thursday dragged copper miners sharply lower. Hudbay Minerals rose more than 1.5% after sinking over 7% in the previous session. Elsewhere, Descartes Systems jumped about 4.5% after reporting second-quarter revenue slightly above estimates.

TSX Rises as Oil Prices Ease

ISEQ increased to an all-time high of 14567.00 Index Points. Over the past 4 weeks, Irish Stock Exchange Overall Index gained 0.7%, and in the last 12 months, it increased 27.32%.

Stocks in Ireland Hit All-time High

The Dow Jones Index is picking up 597 points or 1.15 percent on Friday. Gains are led by Boeing (2.39%), Caterpillar (2.24%) and Cisco Systems (2.22%).

The Dow Jones Index Opens 1.15% Higher

US equities were firmly higher on Friday, halting four sessions of losses as oil prices and Treasury yields paused their surge despite evidence of elevated inflation. The S&P 500, Dow, and Nasdaq 100 rose over 1%. Long-dated Treasury yields eased from their multi-year highs as fuel prices refrained from extending this week's rally, which was fueled by the wave of strikes between the US and Iran in the Persian Gulf. Higher energy prices since the start of the month were due to worsen an already high inflationary outlook, with headline inflation for August holding at 3.4%, consolidating bets that the Fed is due to raise rates on Wednesday. Credit-sensitive sectors in debt-heavy AI hyperscalers and banks remained lower in the week despite gaining on the session. Meanwhile, Oracle surged 5.5% as it reported a surge in cloud infrastructure revenue. The Dow was set to lose 1.4% on the week, while the S&P 500 and the Nasdaq 100 were 0.6% lower.

US Stocks Rebound on Friday

The Ibovespa fell more than 0.5% to trade below 187,500 on Friday, weighed down by losses in the energy sector amid a pullback in oil prices. Prospects for diplomatic efforts to ease tensions around the Strait of Hormuz dragged crude prices lower. Gulf foreign ministers are expected to meet their Iranian counterpart in Oman on Monday as part of efforts to secure support for a temporary arrangement to manage shipping through the strait. Petrobras lost more than 1.5%, while Prio shed over 2.5%. Broader sectors traded mostly below the flatline as the Supreme Court crisis continued to fuel political uncertainty, weighing on the country’s economic outlook. Estate financial stocks traded lower, with BB Seguridade shedding more than 2% and Caixa falling 1%. Utilities posted losses, with Axia down 0.5%. Meanwhile, annual inflation came in slightly below estimates, helping limit losses among major private-sector banks on increased expectations for another Selic cut at the next Copom meeting.

Ibovespa Falls on Petrobras Losses

The UK 10-year gilt yield dipped toward 5.3% as the energy price rally paused and investors digested key data ahead of next week’s policy meetings in the UK and US. Yields nevertheless remained close to 19-year highs, while the 30-year yield hovered near 6%, a level last seen in 1998. UK GDP grew 0.4% month-on-month in July, beating forecasts, while growth over the three months to July also held at 0.4%. Markets expect the BoE to leave rates unchanged next week after Governor Andrew Bailey said future decisions would depend on economic and geopolitical developments, pushing back against the view that another hike is inevitable. Still, markets are fully pricing four BoE rate increases by mid-2027 as elevated oil prices continue to fuel inflation concerns. In the US, the dollar remained supported by growing expectations of a Federal Reserve rate hike next Wednesday following stronger-than-expected core inflation data and signs of a resilient labor market.

UK Gilt Yields Ease but Remain Near Multi-Decade Highs

The British pound held around $1.35 as investors weighed stronger-than-expected UK GDP data ahead of next week’s Bank of England policy decision. UK GDP grew 0.4% month-on-month in July, beating forecasts, while growth over the three months to July also held at 0.4%. Markets expect the BoE to leave rates unchanged next week after Governor Andrew Bailey said on Tuesday that future decisions would depend on economic and geopolitical developments, pushing back against the view that another rate hike is inevitable. Still, markets are fully pricing four BoE rate increases by mid-2027 as the recent oil price rally kept inflation concerns elevated. In the US, the dollar remained supported by growing expectations of a Federal Reserve rate hike next Wednesday following stronger-than-expected core inflation data and signs of a resilient labor market.

Sterling Holds Near $1.35 Ahead of BoE Decision

The euro held around $1.16, near its weakest level in more than a week, as the dollar remained supported by growing expectations that the Federal Reserve will raise interest rates next week following hotter-than-expected US core inflation data. In Europe, the ECB raised rates by 25 basis points on Thursday, warning that inflation is likely to remain well above its 2% target for an extended period. ECB President Christine Lagarde called the decision a “no-brainer” and cautioned that the return to target, currently projected for the end of 2027, could be delayed further. With the inflation outlook deteriorating sharply, further tightening is increasingly seen as likely, according to sources familiar with the discussions, with another hike potentially coming as soon as October. Money markets are pricing in three additional ECB rate increases by March next year, followed by a fourth by June.

Euro Holds at Over One-Week Low

Silver rose to around $65 an ounce on Friday but remained on track for a weekly decline of more than 1% as investors digested the latest US inflation data ahead of next week’s Federal Reserve meeting. US inflation held at 3.4% in August, in line with expectations, while monthly CPI rose 0.4%, the strongest increase in three months. Core CPI accelerated to 0.3% month-on-month, its largest gain since April and above expectations of 0.2%, although the annual rate eased to 2.4%, its lowest since March 2021. US producer prices also accelerated in August as the Iran war pushed wholesale energy costs higher, while last week’s labor market data pointed to continued employment resilience. Markets have increased bets on a 25-basis-point Fed hike next week, with the CME FedWatch Tool now pricing in around a 90% probability, up from roughly 70% before the inflation data.

Silver Set for Weekly Decline as Fed Hike Bets Increase

Gold rose to around $4,350 an ounce on Friday but remained on track for a nearly 2% weekly decline, which would mark its third consecutive weekly loss, as investors digested the latest US inflation data ahead of next week’s Federal Reserve meeting. US inflation held at 3.4% in August, in line with expectations, while monthly CPI rose 0.4%, the strongest increase in three months. Core CPI accelerated to 0.3% month-on-month, its largest gain since April and above expectations of 0.2%, although the annual rate eased to 2.4%, the lowest since March 2021. US producer prices also accelerated in August as the Iran war pushed wholesale energy costs higher, while last week’s labor market data pointed to continued resilience in employment. Markets have increased bets on a 25-basis-point Fed rate hike next week, with the CME FedWatch Tool now showing around a 90% probability, up from roughly 70% before the inflation data.

Gold Heads for Third Weekly Loss as Fed Hike Bets Rise

Futures tracking Canadian stocks rose on Friday as oil prices pulled back on prospects for diplomatic efforts to ease tensions around the Strait of Hormuz. Gulf foreign ministers are expected to meet their Iranian counterpart in Oman on Monday as part of efforts to secure support for a temporary arrangement to manage shipping through the strait. The halt in the energy prices surge allowed equities to enjoy some respite. Meanwhile, the US CPI held steady at 3.4% annually in August 2026, loosely aligned with expectations. Gold prices rebounded, supporting heavyweight mining stocks, while copper extended its decline after dragging copper miners lower on Thursday. Elsewhere, Descartes Systems reported second-quarter revenue slightly above estimates.

TSX Futures Rise as Oil Pulls Back

The yield on the US 10-year Treasury note was around 4.95% on Friday, slightly below Thursday’s levels but still close to 2023 highs. Traders assessed the latest CPI report, which showed the core CPI rose more than expected, increasing 0.3% month-on-month, up from 0.2% in July and above forecasts of 0.2%. The annual core inflation rate, however, slowed to a 2021 low of 2.4%, while headline CPI rose 0.4% as expected, leaving the annual rate at 3.4%. Following the release, the probability of a Fed rate hike next week jumped to around 90%, from roughly 70% beforehand, as the hotter-than-expected monthly core CPI reading bolstered the case for further monetary tightening. Meanwhile, the Treasury Department’s latest buyback operation resulted in weaker-than-expected purchases. The US government repurchased $5.2 billion worth of bonds, below the $6 billion cap and roughly half of the $10.5 billion offered in the operation.

US 10-Year Treasury Yield Close to 2023-Highs

US equity futures were higher on Friday, halting four sessions of losses as oil prices and Treasury yields paused their surge despite evidence of elevated inflation. Contracts for the S&P 500, Dow, and Nasdaq 100 were around 0.7% higher. Long-dated Treasury yields eased from their multi-year highs as fuel prices refrained from extending this week's rally, which was fueled by the wave of strikes between the US and Iran in the Persian Gulf. Higher energy prices since the start of the month were due to worsen an already high inflationary outlook, with headline inflation for August holding at 3.4%, consolidating bets that the Fed is due to raise rates on Wednesday. Credit-sensitive sectors in debt-heavy AI hyperscalers and banks remained lower in the week despite their inching higher premarket. Meanwhile, Oracle surged 5.5% as it reported a surge in cloud infrastructure revenue.

US Futures Hold Respite After CPI

The dollar index rose above 99 on Friday, extending gains for the third session, after US inflation data strengthened expectations that the Federal Reserve could raise interest rates next week. Core CPI, excluding food and energy, increased 0.3% in August from the previous month, slightly above expectations, while the annual rate rose 2.4%, in line with forecasts and the lowest since March 2021. Headline consumer prices increased 0.4% month-on-month and 3.4% from a year earlier, reflecting higher energy costs. The data suggested that inflation remains persistent amid elevated oil prices, tariffs and continued investment in data centres. Markets subsequently priced in around a 90% probability of a rate hike at the Fed’s September 15-16 meeting. Meanwhile, oil prices remain a key concern, having recently moved above $100 a barrel as Middle East and Russia-Ukraine conflicts disrupt supplies.

DXY Rises for 3rd Day

US consumer prices rose 0.4% month-on-month in August 2026, accelerating from 0.1% in July and in line with expectations. It was the largest monthly increase in three months, driven primarily by a 3.9% surge in gasoline prices as crude prices rallied amid escalating US-Iran tensions. Shelter costs rose 0.3%, up from 0.1% in July, while food prices increased 0.1% for a second consecutive month. Communication, lodging away from home, airline fares, education, and used cars and trucks also contributed to the rise. Meanwhile, medical care and motor vehicle insurance costs declined. Core CPI, excluding food and energy, rose 0.3% in August, above expectations for a 0.2% increase.

US CPI Accelerates on Gasoline Surge

Core consumer prices in the United States, which exclude food and energy, went up by 0.3% over a month in August 2026, the most since April, following a 0.2% increase in July and above market forecasts of a 0.2% rise. On a yearly basis, the core inflation rate eased to 2.4% in August from 2.5% the previous month, aligned with market expectations.

US Core Consumer Prices Rises the Most in 4 Months

Brazil’s annual inflation rate eased to 4.22% in August 2026 from 4.44% in July, slightly below forecasts of 4.27% and moving further within the central bank’s target range of 1.50%-4.50%. Price growth slowed for housing (4.90% vs. 5.93%), clothing (3.25% vs. 3.87%), transport (3.04% vs. 3.64%), health and personal care (5.84% vs. 6.16%), and education (5.98% vs. 6.27%). The moderation in transport costs was partly driven by easing fuels and energy inflation, which fell to 4.60% from 7.60%. Although oil prices surged internationally amid tensions in the Middle East, Petrobras refrained from immediately passing on the external volatility to its refineries, resulting in a cumulative gap relative to international market prices. On a monthly basis, consumer prices declined 0.32%, following a marginal 0.1% increase in July. CPI has risen 3.11% year to date.

Brazil Inflation Moves Deeper Into BCB Target Range

The core inflation rate in the US, which excludes exogenous food and fuel costs, eased to 2.4% in August of 2026 from 2.5% the previous month, aligned with market expectations. Inflation was lower for commodities less food and energy commodities (0.7%) and new vehicles (0.6%). In turn, price growth remained elevated for shelter (3.0%) and medical care services (2.5%), while remaining close to the core rate for transportation services (2.4%). From the previous month, core consumer prices rose by 0.3%.

US Core Inflation Eases Slightly

The annual inflation rate in the US steadied at 3.4% in August 2026, the same as in July and in line with forecasts. On a monthly basis, the CPI rose 0.4%, the most in three months, also matching forecasts. Gasoline rose 3.9% in August, accounting for over one third of the monthly all items increase. Meanwhile, core CPI rose 0.3% on the month, above 0.2% in July and forecasts of 0.3%. The annual rate however, slowed to 2.4%, the lowest reading since March 2021, from 2.5%, as expected.

US CPI Report Comes Broadly in Line with Forecasts

The Russian ruble hovered near the 85 per USD mark, not far from the 18-month low of 87 as Russia's fuel crisis hampered foreign exchange flows. Ukraine delivered a wave of strikes against Russian oil assets and refining infrastructure through August. Consequently, Russian petroleum production shrank by 160 thousand barrels per day to 8.718 million bpd in August, the second-sharpest reduction this year. On top of that, attacks on Russia's major refiners cut capacity on production of gasoline and diesel, driving Moscow to ban exports of fuel and swing the Russian economy into an importer of refined product. This triggered an aggressive reversal in goods and capital flows from the Russian financial system, forcing foreign currency outwards and driving the ruble to nosedive from the three-year high of 71 on May 28th to the current 18-month low. In turn, ruble supply rose as the federal government was forced to issue soaring levels of debt to make up for the plunge in energy revenues.

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