Global markets to face geopolitical and monetary risks in September
Global financial markets may face the consequences of the war with Iran, decisions by the US Federal Reserve and the Bank of Japan, as well as political risks in France, the United Kingdom and the United States simultaneously in September. This was reported by Channel NewsAsia, citing Reuters.
One of the main factors for investors remains the situation around the Strait of Hormuz. Oil and gas prices fluctuated as traders tried to assess when and how key waterways, including the strait, could reopen. Rising energy prices supported energy company stocks but hurt major energy consumers, while higher inflation put pressure on government bonds.
In the short term, market participants will monitor negotiations between Iran and Oman on managing the situation in the Strait of Hormuz. At the same time, investors are considering the possibility of geopolitical and economic realignment, including the construction of pipelines bypassing the strait and the formation of new regional alliances.
Fed and Bank of Japan decisions
The US Federal Reserve meeting on September 16 and the Bank of Japan meeting on September 18 will take place within one week, which could increase market volatility. Markets put the probability of a Fed rate hike at about 40%. Communication by Fed Chair Kevin Warsh, who is due to speak at the Jackson Hole symposium, has also been cited as an important factor.
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In Japan, which recently intervened to strengthen the yen, markets expect a rate hike by the Bank of Japan. The yield on 10-year Japanese government bonds is approaching 3%, the highest level since the mid-1990s.
Artificial intelligence and political risks
A potential initial public offering by Anthropic could become a separate test for the technology sector. According to reports, the company expects to raise up to $100 billion, while its valuation stood at $965 billion in May. Analysts note that weakening investor interest in artificial intelligence companies could affect not only new listings but also shares in Nvidia, Microsoft and other companies whose value depends on expectations of demand for AI infrastructure.
In France, the government is due to submit a draft budget to the National Assembly in the coming weeks. Investors are assessing the risk of rising French government bond yields amid government efforts to contain the deficit ahead of the 2027 presidential election. In the United Kingdom, markets will monitor the October budget of Prime Minister Andy Burnham's government and the Labour Party conference in September.
In the United States, economic decisions may be influenced by the intensification of the campaign ahead of the midterm elections in November. The average gasoline price in the country has exceeded $4 per gallon because of the war with Iran, while in January it was below $3.
