Overview
- U.S. forces struck Iranian rocket launchers on Larak Island, CENTCOM confirmed late Sunday, and Iran reported retaliatory attacks that included a claimed hit on a tanker and strikes on U.S. positions.
- Brent and other crude benchmarks jumped toward $90 a barrel as traders priced a renewed risk to shipments through the Strait of Hormuz, and Asian shares and U.S. futures fell on the move.
- Comments by Federal Reserve Chair Kevin Warsh at Jackson Hole hardened rate expectations and, together with the energy shock, pushed the implied chance of a September 25bp hike into the high‑50s to low‑60s percent range.
- Short‑term government yields spiked—two‑year U.S. yields rose above about 4.3% and the 10‑year climbed toward 4.7%—and investors now see Tuesday’s JOLTS, Friday’s payrolls, and the Sept. 11 CPI as decisive inputs for Fed timing.
- The Strait of Hormuz disruption links directly to global inflation and borrowing costs, which could raise fuel bills, slow rate‑sensitive sectors and force other central banks and banks to reassess policy and risk positions.