The “high point of this day of June 10 resounded at 2:30 p.m. with the publication of the American “CPI”. The most important figure of the week (apart from the subscription rate of the SpaceX IPO, estimated at 3.5 times) and which results in a non-event, as every time Wall Street presents the thing as a major issue As soon as it was published, commentators were quick to declare with great unanimity: “it is in line with expectations, not worse than expected”.
American inflation rose by 0.5% in May, bringing the increase at an annual rate to 4.2% (this is comparable to the rate from March to June 2021, which took the central banks by surprise), “core” inflation stood at 2.9%… we are rejoicing, the 3% mark has not been reached (this this time).
The US T-Bonds barely flinched at 2:30 p.m. and a perfect status quo prevails this evening: 4.5300% on the “10 years”, 5.012% on the “30 years”, apparently nothing has happened since Tuesday evening at 10 p.m.
And yet, T-Bonds would have deserved to regain their status as a safe haven asset given current geopolitical events.
Yesterday, Trump announced for the 28th time the prospect of an agreement between Washington and Tehran, today, like the 28 previous times, nothing is happening as the markets hoped and it’s even quite the opposite (sometimes, just nothing happened) because on Wednesday, it’s all-out military escalation.
Iran bombed US military targets in Bahrain and Jordan, Kuwait retaliated after the drone strike on its airport, the United States targeted Iranian air defense systems, ground control stations and surveillance radars near the strait.
And according to Trump’s latest statements (5:45 p.m.: “we are going to attack Iran hard”), this will intensify over the next few hours (with also “non-military” targets as at the beginning of April).
Iran has already promised to retaliate in an even more devastating way: atmosphere!
After having fallen by almost 6% in one week, oil prices started to rise again with 2.1% for WTI, to 91 USD per barrel, while Brent increased by 2.4% to 93.9 USD.
The price of black gold is also supported by a decline in American stocks of 7.22 million barrels, when specialists anticipated a more limited decline of 3 million barrels.
Furthermore, UBS reports that a single LNG tanker crossed the Strait of Hormuz at the start of the week, managing to leave the Gulf. According to the group’s calculations, this is the seventh LNG tanker to leave the Gulf since the start of the conflict.
The daily average for June remains close to that of April-May, at around three ships per day, but remains much lower than that of February, which reached almost 50 daily passages.
In Europe, heaviness prevails with Bunds and OATs which rise from 2 points to 2.5 points respectively, to 3.077% and 3.737%, Italian BTPs add 3.3 points to 3.856%.
Finally, mainly negative scores on Japanese issues with a “10 year” at 2.70%, which increases by 1.5Pt, the “20 year” adds 1Pt to 3.586%, the “30 year” on the other hand erases -1Pt to 3.875%.
