Global markets are reacting to rising oil prices driven by US-Iran tensions while awaiting a 'warm' US CPI report that could signal persistent second-round inflation effects.
Key Takeaways
- 1.Oil prices are rallying toward $108/barrel due to heightened US-Iran geopolitical tensions and the dismissal of counter-offers.
- 2.US April CPI is expected to show 'warm' inflation (0.7% m/m headline), marking the start of tracking second-round effects from commodity surges.
- 3.UK Gilts are underperforming global peers due to a combination of inflation risks and political instability within PM Starmer's cabinet.
Table of Contents
- On Deck for Tuesday, May 12th
- Contributors
- KEY POINTS
- US CPI—THE LONG MARCH OF SECOND-ROUND EFFECTS
- OTHER—US ADP, US BUDGET UPDATE, AUSTRALIAN BUDGET
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Authors
Derek Holt
Securities
WTI CrudeUK GiltsS&P 500USDCAD
Themes
Second-round inflation effectsGeopolitical risk and energy pricesCentral Bank leadership transitionFiscal Policy and Housing Affordability
Regions
North AmericaEuropeUKUnited StatesAustraliaUnited Kingdom