TMGM Daily Market Breakfast: 2026-08-11

Morning Snapshot

• Oil prices rose sharply during the reporting window as uncertainty over the reopening of the Strait of Hormuz, Iran’s conditions for restoring shipping access and a reported Houthi drone attack on Saudi energy infrastructure kept supply concerns elevated.
• Iran said it would not negotiate with US President Donald Trump until his term ends, adding to diplomatic strain around efforts to reopen the Strait of Hormuz.
• Cleveland Fed President Beth Hammack said current US policy is not meaningfully restricting the economy and called for some number of rate hikes.
• US Treasury yields rose on Monday as markets prepared for upcoming US inflation data while higher oil prices revived inflation concerns.
• Reserve Bank of Australia coverage indicated the central bank was set to leave its policy rate unchanged at 4.35% for a second straight meeting as inflation pressures eased.
• Reporting on the Bank of Japan said rising long-end Japanese government bond yields and the July policy discussion summary pointed to growing expectations of further monetary tightening.
• Coverage of recent US labour data said weaker payrolls and downward revisions had reduced market pricing for a September Federal Reserve rate increase.
• US Dollar coverage said the currency found support from safe-haven demand linked to Middle East tensions even as softer US labour data tempered expectations for near-term Federal Reserve tightening.

Overview

Middle East developments dominated the reporting window, with the Strait of Hormuz remaining the central focus for energy markets and broader risk sentiment. Multiple reports described uncertainty over when the waterway would fully reopen, while Iran set out conditions including the lifting of the US naval blockade, the withdrawal of US forces from around Iran, compensation for conflict-related damage, sanctions relief and the release of frozen assets. One report also said Yemen’s Iran-backed Houthis claimed a drone attack on a Saudi Aramco refinery in Jazan.

US monetary-policy coverage was mixed. Cleveland Fed President Beth Hammack argued that policy was not restrictive enough and said further rate increases were needed, while separate reporting on recent US labour-market data said weaker payrolls and downward revisions had reduced market pricing for a September move. Treasury yields nevertheless rose as markets looked ahead to US inflation data and assessed the implications of higher oil prices.

In the Asia-Pacific region, reporting indicated the Reserve Bank of Australia was set to keep its policy rate at 4.35% for a second consecutive meeting as softer inflation cooled expectations of further tightening. In Japan, coverage of the Bank of Japan’s July policy discussion summary said the debate had shifted toward preventing an inflation overshoot, with markets pricing a meaningful chance of another rate increase later this year.

Geopolitical Developments

Strait of Hormuz uncertainty keeps Middle East tensions in focus

Several reports during the window said uncertainty over the reopening of the Strait of Hormuz remained a major issue for global energy markets and regional diplomacy. Coverage said Iran had set conditions for a full reopening that included ending the US naval blockade, withdrawing US naval and air forces from around Iran, compensating for damage from recent conflicts, lifting sanctions and unconditionally releasing frozen Iranian assets. One report added that talks with Oman on a safe shipping route were progressing, but that no agreement on a full reopening had been reached. The same coverage said around 20% of global energy supply passes through the strait, underlining the significance of any prolonged disruption.

Iran rules out negotiations with Trump during his term

A separate geopolitical report said Iran would not negotiate with US President Donald Trump until his term ends on January 20, 2029. The article described the stance as a setback to efforts to reopen the Strait of Hormuz and reduce Middle East tensions, citing Iranian outlets and a social-media post by an adviser to Parliament Speaker Mohammad Bagher Ghalibaf. The report linked the announcement to the broader diplomatic impasse surrounding shipping access and regional security.

Energy & Commodities

Oil prices jump as supply concerns persist around Hormuz

Oil-market coverage said West Texas Intermediate rose strongly on Monday as uncertainty over the Strait of Hormuz reopening kept supply concerns elevated. One report said WTI was up more than 6% and trading around $81.15 per barrel near a one-week high, while earlier reports said prices were up 3.20% around $78.80 and later still 1.6% around $77.55 after coming off intraday highs. The supplied articles attributed the move to the lack of clarity on shipping access, Iran’s reopening conditions and continued geopolitical tension. One report also said Yemen’s Iran-backed Houthis claimed responsibility for a drone attack on a Saudi Aramco refinery in Jazan, adding to concerns about regional energy infrastructure.

Macroeconomics & Central Banks

Fed official says US policy is not restrictive enough

Cleveland Fed President Beth Hammack said on Monday that current US monetary policy is not “meaningfully restricting the economy” and that there is a need for some number of rate hikes. The report characterised her remarks as hawkish and presented them as a clear signal that at least one Federal Reserve official still sees the case for further tightening despite recent debate over the economic outlook.

US Treasury yields rise ahead of inflation data

A separate US macro report said Treasury yields climbed on Monday as markets prepared for the release of US inflation figures later in the week. The article said higher oil prices had revived inflation concerns and noted that the move followed a worse-than-expected US Nonfarm Payrolls report on the previous Friday. The coverage linked the rise in yields to renewed focus on inflation risks rather than to a confirmed policy decision.

RBA seen holding cash rate at 4.35%

Reporting published late in the window said the Reserve Bank of Australia was on track to keep the Official Cash Rate unchanged at 4.35% for a second consecutive meeting on Tuesday. The article said softer inflation had cooled expectations of another increase, framing the expected decision as a pause rather than a shift in policy direction.

BoJ discussion summary points to tightening debate

Coverage on Japan said rising long-end Japanese government bond yields and the Bank of Japan’s July Summary of Opinions had strengthened expectations of further tightening. The report said several members favoured leaving the policy rate unchanged at the latest meeting to assess the lagged effect of the previous increase, but that the overall tone pointed toward additional tightening. It added that the policy debate had shifted from lifting inflation to 2% toward preventing an overshoot, and said markets were pricing roughly a 50% chance of a 25 basis point increase in September and a full increase by year-end.

Weaker US labour data reduces September hike pricing

Another report on the US policy outlook said weaker employment data and downward revisions had sharply reduced expectations for a September Federal Reserve rate increase. The article said July payrolls unexpectedly fell by 23,000 and noted that pricing for a September move had dropped to less than 50%, compared with 72% at the end of July, while one increase remained priced for December. The report presented the labour data as reopening debate over the Federal Reserve’s dual mandate.

Foreign Exchange

US dollar supported by geopolitical demand despite softer labour backdrop

Foreign-exchange coverage said the US Dollar Index traded around 99.70 during Asian hours on Monday after finding support from safe-haven demand linked to Middle East tensions and uncertainty around the Strait of Hormuz. The same report said weaker-than-expected US employment data had reduced expectations for a near-term Federal Reserve rate increase, citing a market-implied probability of around 46% for a September move, down from 67% a week earlier. The article therefore described the dollar as being influenced by both geopolitical risk aversion and changing US rate expectations.

Closing Summary

The reporting window was led by Middle East tensions centred on the Strait of Hormuz, with oil supply concerns, Iran’s negotiating stance and related diplomatic uncertainty shaping the news flow. Alongside that, markets absorbed mixed Federal Reserve signals, rising US Treasury yields ahead of inflation data, an expected RBA hold and continued discussion of further Bank of Japan tightening.