Cover Story
Issue 01Reuters reported attacks on three commercial vessels in the Strait of Hormuz and said U.S. Central Command described subsequent U.S. strikes on Iran as responsive to the shipping incidents. Brent settled at $74.16 a barrel and WTI at $70.44, while OFAC limited previously authorized Iran oil trade to wind-down activity through July 17.
Market attention centered on a draft government blueprint that called for monetary policy to align with growth strategy and omitted language on improving fiscal health. Economy Minister Minoru Kiuchi said policy decisions remain the Bank of Japan’s responsibility and said the government is not abandoning fiscal discipline.
In a July 7 country-classification update, S&P Dow Jones Indices kept Indonesia classified as emerging while placing it on its 2027 watchlist for regulatory developments linked to stock-ownership transparency. It said worsening conditions could prompt special treatment for Indonesian securities, with classification assessed in a later annual review if issues remain unresolved.
South Korea’s benchmark ended July 8 at 7,246.79, down 5.35%, after rebounding briefly and then falling enough to trigger a sidecar curb on program trading. Samsung Electronics fell 6.3% and SK Hynix 5.7% as chip shares tracked an overnight 4.7% decline in the Philadelphia Semiconductor Index.
Reuters reported attacks on three commercial vessels in the Strait of Hormuz and said U.S. Central Command described subsequent U.S. strikes on Iran as responsive to the shipping incidents. Brent settled at $74.16 a barrel and WTI at $70.44, while OFAC limited previously authorized Iran oil trade to wind-down activity through July 17.
Reports on July 7 said HSBC has informed some private credit clients it will not extend certain lending lines and will stop providing subordinated leverage financing. The bank said some relationships no longer offered returns commensurate with risk and that it will focus on lower-risk funds.
Authorities in Hong Kong and Mainland China said the annual Southbound Bond Connect quota will rise to RMB800 billion from RMB500 billion, with plans for repo using southbound holdings, wider eligible products and Macao linkage. The package also adds collateral, settlement and offshore RMB liquidity measures, including a larger RMB Business Facility from July 10.
In records and papers published on 7 July 2026, the Bank of England’s Financial Policy Committee proposed removing the countercyclical leverage buffer, cutting the Tier 1 leverage minimum to 3% from 3.25%, setting systemic leverage buffers at 50% of risk-weighted equivalents, and adding a releasable 25-basis-point general buffer.
The Reserve Bank of New Zealand unanimously increased the official cash rate by 25 basis points from 2.25% to 2.50%, citing persistent non-tradables inflation and recent easing in financial conditions. It said further tightening appears likely, but timing will depend on incoming data, pricing behaviour and spare capacity.
Brent and WTI each rose about 3% intraday as markets assessed renewed military exchanges between the United States and Iran and Washington's move to restore restrictions on Iranian crude sales. Traders also tracked risks to Strait of Hormuz shipping, expected U.S. inventory draws and short-covering from large bearish positions.
Thailand’s headline CPI rose 2.42% year on year in June, slowing from 2.79% in May and coming in below market expectations. Core inflation was 1.23%, while the reading stayed within the Bank of Thailand’s 1%-3% target band. The Commerce Ministry kept its 2026 inflation forecast at 1.5%-2.5%.
Destatis said German manufacturing orders fell 3.8% in April from March after a 5.0% rise in March. Foreign orders dropped 4.2%, led by an 11.1% decline from the euro area, while domestic orders fell 2.9%. Orders excluding large contracts also slipped 3.8%, and real manufacturing turnover edged up 0.1%.
Danish shipping group BIMCO said more vessels were resuming Strait of Hormuz passages after the US-Iran ceasefire, but warned that congestion, navigational incidents and electronic interference still affect transit decisions. It said operators should rely on voyage-specific risk assessments and official advisories, and that a return to pre-conflict traffic could take months.
In September 2025, Baillie Gifford said it was consulting on changes across about 1,600 employees, with up to 50 positions potentially affected and some departures expected before year-end. The firm said it was reallocating roles to reflect changes in client distribution, while using internal mobility to redeploy staff where possible.
S&P Global Market Intelligence reported that institutional investors were net sellers of $50.20 billion in equities in December 2024, the largest monthly sale of the year. Index funds and ETFs were net buyers of $25.89 billion, while retail investors also sold a net $7.84 billion and hedge funds bought $20.44 billion.
ICICI Bank's last benchmark US dollar senior bond was a $500 million 3.8% note due 2027 issued in December 2017 through its Dubai branch. The bank's disclosures show foreign-currency senior unsecured ratings of Baa3 from Moody's and BBB from S&P, while April 2026 investor materials detailed capital, deposits and asset-quality metrics.
China’s central bank said it injected a net 10 billion yuan through open-market government bond purchases and sales in June, with first-half net injections via that channel reaching 300 billion yuan. The PBOC said such operations have been conducted routinely this year, with sizes adjusted to liquidity needs and bond-market conditions.