"With the standoff over the Strait of Hormuz continuing and safe passage seemingly only guaranteed for luxury mega-yachts, rather than shipments relied on by many millions, it's keeping worries about an energy crunch front and centre."
"The benchmark, Brent crude, is still hovering around the painful level of $111 a barrel, a three-week high, and the big worry is that as companies have to shoulder elevated bills for longer, they'll have little choice but to pass on the costs through higher prices."
"Financial markets are now pricing in as many as three rate hikes from the Bank of England. It's a marked difference from last week's expectations of just one hike."
"Worry about the expected ramp-up in rates is showing up in the bond markets. Gilt yields have risen above 5%, levels not seen since the financial crisis."
The standoff over the Strait of Hormuz is causing significant worries about an energy crunch, particularly affecting the global economy and increasing borrowing costs. Brent crude prices are at a three-week high of $111 a barrel, prompting companies to pass on costs to consumers and employees to demand higher wages. Central banks are expected to pause but may raise interest rates as commodity supplies remain constrained. Financial markets anticipate multiple rate hikes from the Bank of England, leading to higher mortgage rates and increased gilt yields, complicating government debt financing.
Read at London Business News | Londonlovesbusiness.com
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