The latest statement by United States Secretary of the Treasury, Vicente, brought the focus of the market back to the situation in the Middle East and to the United States debt market. He stated that the United States probably did not need to restart large-scale military operations against Iran and that economic sanctions might still be the main instrument. At the same time, he tried to calm the bond market, arguing that the Treasury Department might expand the scale of the buy-back of the national debt and arguing that the United States budget deficit was “probably likely” to have peaked.
The Iranian problem is still dominated by economic pressure.
In an interview with CNBC, Becent stated that the United States was not convinced that there was a need for another large-scale war against Iran. This statement, following the tougher economic warning given to Tehran by Trump, also kept the market concerned about whether sanctions would be a substitute for further military escalation.
In response to Trump's claim that the Iranian economy is “crashing”, the report quotes a former Central Bank of Iran adviser who made different points. According to the source, the Iranian economy was not nearing a total collapse, but it could still be a clear blow to Iran if the United Arab Emirates cut off trade.
Treasury's repurchase failed to contain the rate of return.
With regard to debt markets, Becent stated that faster buy-backs of United States Treasury bonds could exceed the announced $4 billion and indicated that the Treasury Department was willing to “market” to curb long-term national debt sales.
He also indicated that the United States fiscal deficit in Trump had “a great opportunity” to peak. In July, however, the United States continued to have a monthly budget deficit of over $432.0 billion, which has been high for more than five years, a judgement that the market did not quickly accept.
The bond market then reacted in reverse. The rate of return, which had previously been reversed by the Ministry of Finance, largely erased the impact of the intervention. The United States share was also under pressure, with the index of 500 falling 0.9 per cent that day. The small initial change in the futures pallet suggests that traders are still judging whether this fall is short-term fluctuations or a more persistent stretch between the Treasury and the debtor market.
Japan's inflation is rising, and it's better than a bit of a coin.
In addition to the United States market, inflation in Japan became an important variable of the day. Japan ' s overall prices have risen to the highest level ever, and rising energy costs continue to push up inflation and put pressure on the Bank of Japan ' s subsequent interest rate path.
In the area of risk assets, Moderna's cancer vaccine, in collaboration with Meshatung, was a positive development in later clinical trials, leading to a marked increase in the share price of two companies. The encryption market is also strong, with bitcoin rising 12% in two days. It was reported that this was related to the progress of Clarity Act by the Washington side and by the encryption executives.
Overall, Becent spoke on both geopolitical and debt markets that day, but the feedback from the market was not consistent. The situation in the Middle East has not yet signaled a new military escalation, while the United States bond market continues to respond to the Department of the Treasury's appeasement with a higher rate of return.