# Oil Climbs as US Strikes on Iran, Eco Weekahead

An episode of [Bloomberg Daybreak: Asia Edition](https://invisiblenetwork.ai/podcast/1663863437), 13 Jul 2026, 14 min.

Audio: https://podtrac.com/pts/redirect.mp3/traffic.omny.fm/d/clips/e73c998e-6e60-432f-8610-ae210140c5b1/58e85be7-dbb5-4043-afed-af80014dc0b3/b167afdc-eb64-41bf-8cdc-b486002460fb/audio.mp3?utm_source=Podcast&in_playlist=27143354-63aa-4ac5-965d-af80014dc0d3

Business and finance news from the Asia-Pacific. For analysis on the week ahead, highlighted by the US-consumer price report and two days of testimony from Fed Chair Kevin Warsh, Bloomberg TV Host Shery Ahn spoke to Frederic Neumann, Chief Asia Economist at HSBC. Oil rose and Treasuries fell after the US launched another round of strikes against Iran, reviving concern that higher energy prices will keep inflation elevated and interest rates higher for longer. Brent crude climbed 4.4% to $79.35 a barrel as conflicting claims over the status of the Strait of Hormuz fueled speculation about potential supply disruptions. Treasuries dropped across the curve with the yield on the rate-sensitive two-year note climbing three basis points to 4.24%, the highest since February 2025. Australian and Japanese sovereign bonds also fell, while the dollar strengthened against all of its Group-of-10 peers. For more on this, Bloomberg TV Host Avril Hong talked to Mark Cranfield, Bloomberg Strategist. See omnystudio.com/listener for privacy information.

## Transcript

[0:02] Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
[0:10] Speaker 2: Welcome to the Daybreak Asia podcast. I'm Dog Christner. Crude
[0:13] Speaker 2: oil prices are rallying at this hour after the US
[0:16] Speaker 2: launched more strikes against Iran at five pm Eastern Time
[0:20] Speaker 2: Sunday evening. Now. The aim, according to US officials, was
[0:24] Speaker 2: to degrade Iran's ability to attack ships in the Straight
[0:27] Speaker 2: of horm moves. Now, there have been conflicting declarations over
[0:32] Speaker 2: whether the strait remains open to shipping. Here is Bloomberg's
[0:35] Speaker 2: John Herskowitz.
[0:36] Speaker 3: We have Iran saying that they've shut the straight, the
[0:39] Speaker 3: usaying that the strait is open. But the basics really
[0:43] Speaker 3: haven't changed. Iran wants shipping to go near its coast.
[0:48] Speaker 3: It doesn't like to see shipping going near Oman, which
[0:52] Speaker 3: sometimes gets the assistance of the US. So for Iran,
[0:55] Speaker 3: the long term considerations keeping control of Hormuz, keep shipping
[1:00] Speaker 3: close to itself. It can better, it has better access
[1:03] Speaker 3: to it. When it gets closer to a mine, it's
[1:06] Speaker 3: more difficult for it to do so. That hasn't changed.
[1:09] Speaker 2: That is Bloomberg's John Herskowitz. There will be a lot
[1:12] Speaker 2: for markets to consider in the week ahead. Among the
[1:14] Speaker 2: highlights the report on US consumer prices and two days
[1:19] Speaker 2: of congressional testimony from Fed share Kevin Walsh. Earlier, Bloomberg
[1:23] Speaker 2: cherry On spoke about the week ahead with Fred Newman.
[1:26] Speaker 2: He is the chief Asia economist at HSBC.
[1:29] Speaker 4: Look, we're probably going to get inflation numbers this week
[1:31] Speaker 4: out of the US that show a bit of a
[1:32] Speaker 4: pullback in inflation. Was gas prices were down, But of
[1:35] Speaker 4: course it's a bit of a yesterday's story because oil
[1:38] Speaker 4: has started to track up again. If that sustained, then
[1:41] Speaker 4: that means maybe the June CPI dip is just that,
[1:45] Speaker 4: just to dip, and so we might see price pressures
[1:48] Speaker 4: come back. But really watching mister Walsh, what mister Walsh
[1:51] Speaker 4: has to say in front of Congress this week, because
[1:54] Speaker 4: he might give away a little bit of how worried
[1:56] Speaker 4: he really is about underlying inflation, because it's not just
[1:59] Speaker 4: a gas price. This is about core services have started
[2:02] Speaker 4: to increase, and that's maybe a more persistent price pressure
[2:05] Speaker 4: coming through in the US.
[2:07] Speaker 1: So we've heard a little bit from him, We're expecting
[2:09] Speaker 1: to hear more from him in Congress. What are some
[2:12] Speaker 1: of the signals that we're getting from him, especially at
[2:14] Speaker 1: a time where we may not be getting a lot
[2:16] Speaker 1: of signals from this FED at least.
[2:18] Speaker 4: Well, yeah, he said he wants to reduce the signal
[2:21] Speaker 4: or the noise at least, So yeah, we have less
[2:24] Speaker 4: to go on preps with this FED chair than with
[2:26] Speaker 4: previous FED chairs potentially. But remember when he came in
[2:30] Speaker 4: the first meeting, he came out with the press confidence
[2:33] Speaker 4: said look, I'm really going to focus on inflation, and
[2:36] Speaker 4: the market took this as being hawkish, and so now
[2:40] Speaker 4: we have another opportunity to get a bit more nuance
[2:43] Speaker 4: and how he thinks about monetary policy, but not just
[2:46] Speaker 4: monetary policy, even financial stability issues, which remember we have
[2:50] Speaker 4: a very frothy kind of acid environment in the US,
[2:53] Speaker 4: and is the FED starting to be concerned about accid
[2:56] Speaker 4: valuations for example. That plays into the conversation as well as.
[3:01] Speaker 1: What are you seeing in terms of what the systemic
[3:03] Speaker 1: risk could be from the financial sector, because now perhaps
[3:07] Speaker 1: we're seeing this text sell off sell sort of deep
[3:10] Speaker 1: buying it. There's a lot of momentum and volatility right now.
[3:13] Speaker 4: There's a lot of volatility, of course, and that's always
[3:16] Speaker 4: a bit worrying because you think, but while invest is
[3:19] Speaker 4: reassessing things fundamentally. The big question though from financial stability
[3:24] Speaker 4: perspective is how much leverage is there? And there are
[3:28] Speaker 4: signs I think that leverage is coming back in if
[3:30] Speaker 4: we look at how much boring that goes into the
[3:33] Speaker 4: AI hardware sector, for example, the hyperscaler is starting to borrow.
[3:38] Speaker 4: Is there private credit element that's feeding into this, So
[3:42] Speaker 4: we could see potentially the FED starting to say, well,
[3:45] Speaker 4: look guys at the margin. You know, we're starting to
[3:48] Speaker 4: see an increase in leverage. We need to monitor this.
[3:50] Speaker 4: And that's why these remarks as will be interesting.
[3:53] Speaker 1: A lot of the hardware, of course, is coming from
[3:54] Speaker 1: Northeast Asia. Right now, let's talk a little bit about
[3:57] Speaker 1: Japan because a lot of people like the Japanese markets play,
[4:00] Speaker 1: especially equities that perhaps are broader than South Korea. Let's
[4:04] Speaker 1: not get into the market so far with an economist,
[4:06] Speaker 1: but when it comes to the Japanese economy, what is
[4:11] Speaker 1: happening right now? Because we're seeing this big upside in
[4:14] Speaker 1: investor sentiment positivity, and yet the yen continues to weaken.
[4:19] Speaker 4: Yeah, the end is weaker, and that you know, has
[4:22] Speaker 4: something to do with high energy price that has to
[4:25] Speaker 4: do with the fact that interest rates here possibly a
[4:27] Speaker 4: little bit too low relative toward the economy.
[4:30] Speaker 1: You think the bog is behind the curve a little bit.
[4:33] Speaker 4: Yeah, they just hiked interest rates, of course, and they
[4:35] Speaker 4: probably have to nudge rates higher as well. But look,
[4:38] Speaker 4: the economy is actually doing quite well, and prices are
[4:41] Speaker 4: going up, and we know consumers are telling us they're
[4:43] Speaker 4: worried about inflation, and even businesses are worried about inflation,
[4:47] Speaker 4: and so all of that suggests rising as the prices
[4:50] Speaker 4: not just equity but real estate as well. Economy is
[4:53] Speaker 4: doing well. Inflation that's slightly you know, underlying inflation which
[4:57] Speaker 4: is quite high. Well, that's the environment for the central
[5:00] Speaker 4: bank to raise rates, and until they do, the end
[5:02] Speaker 4: will stay under pressure.
[5:03] Speaker 1: A lot of debate right now whether or not that
[5:05] Speaker 1: is political, with the Takaish administration really wanting to see
[5:08] Speaker 1: a looser policy. But finally we're getting some indications that
[5:11] Speaker 1: perhaps the government are not necessarily going to target the
[5:14] Speaker 1: weakness into the end just through intervention finance. Minster Katayama
[5:18] Speaker 1: talking about pension funds should invest or just investment funds
[5:21] Speaker 1: should invest in Japan? Will that have implications for the
[5:26] Speaker 1: global debt markets? For all of those assets that are
[5:28] Speaker 1: outside of the country. This repatriation trade that a lot
[5:31] Speaker 1: of people have feared.
[5:33] Speaker 4: That's right, the repatriation trade. At some point it will
[5:36] Speaker 4: come and it will be a big story in global
[5:38] Speaker 4: markets because Japanese have been lenders to the world, have
[5:42] Speaker 4: kept interest rates low, and if they bring money back,
[5:45] Speaker 4: that means high interest rates elsewhere and money will just
[5:48] Speaker 4: come back and strengthen again. But when will this happen
[5:52] Speaker 4: is a big question. Just announcing the pension fund will
[5:54] Speaker 4: do that might not be enough to trigger that. We
[5:56] Speaker 4: the private sectors start to move funds, and they're probably
[5:59] Speaker 4: only do that when interest rates are higher. They're still
[6:02] Speaker 4: waiting for higher returns on money. So not just yet,
[6:06] Speaker 4: not just yet for that big repetuation.
[6:08] Speaker 1: Well, we might get higher interest rates in South Korea.
[6:10] Speaker 4: This week does makes sense, yeah, because we are seeing
[6:14] Speaker 4: some economy is doing quite well, so Japan's hiking interest rates.
[6:17] Speaker 4: We just saw the RB and Z in New Zealand
[6:20] Speaker 4: raise interest rates and be okay. This week is clearly
[6:23] Speaker 4: on the docket as well. Why because the entire economy
[6:26] Speaker 4: is being lifted up by the AI hardware boom. Semiconductor
[6:29] Speaker 4: prices are up exports are shooting up, and then you
[6:32] Speaker 4: get this big fiscal windfall which at some point that
[6:35] Speaker 4: will turn around and spend as well, and so and
[6:38] Speaker 4: you get high equity prices. So that is all a recipe.
[6:42] Speaker 1: For ultimately one.
[6:45] Speaker 4: Well, that is very technical because of course, if equity
[6:48] Speaker 4: prices rise and foreigners have to sell because they have
[6:51] Speaker 4: too much, well, they have too much of equity hold
[6:55] Speaker 4: too much of equity prices rise, the need to sell them,
[6:57] Speaker 4: and so that depresses the end the Korean one. Fundamentally,
[7:02] Speaker 4: it's a currency that should be appreciating if you look
[7:05] Speaker 4: just at the trade or plus and so forth. But
[7:08] Speaker 4: of course the dynamics are on equity flows. It's so
[7:11] Speaker 4: distorative right now that it's very hard to call the end,
[7:15] Speaker 4: to call it Korean one in the near future.
[7:17] Speaker 1: Risk is a situation that so much depends in that
[7:20] Speaker 1: economy on the semiconductor trade right now.
[7:24] Speaker 4: A lot of it it is semiconductors. And it's not
[7:26] Speaker 4: just that the exports are going up, but it's also
[7:28] Speaker 4: that the equity market is going up because of that,
[7:31] Speaker 4: and that provides wealth to the economy as a wealth effect.
[7:35] Speaker 4: But it's also important fiscally because the tax revenues from
[7:39] Speaker 4: the surging and semiconduct sales is huge.
[7:42] Speaker 1: Can they build a buffer enough though, if you see
[7:44] Speaker 1: this boom and bus cycle that we've seen before in
[7:47] Speaker 1: the semiconductor world, that that could actually help in the future.
[7:51] Speaker 4: Ideally, Yes, you want to build a buffer. You want
[7:53] Speaker 4: to build a buffer. Is there a temptation to spend
[7:55] Speaker 4: it as quickly as you can? There always is, that's
[7:57] Speaker 4: human nature. But build a buffer. Yes, that would help
[8:00] Speaker 4: in times when it's less sunshiny and more rainy.
[8:05] Speaker 2: That was Fred Newman, Chief Asia Economist at HSBC, speaking
[8:08] Speaker 2: with Bloomberg sherry On here on the Daybreak Asia podcast.
[8:17] Speaker 2: Welcome back to the Daybreak Asia podcast. I'm Doug Chrisner.
[8:21] Speaker 2: In the US, last Friday, markets seemed to look through
[8:24] Speaker 2: geopolitics and toward corporate earnings. This Tuesday, we'll hear from
[8:28] Speaker 2: five of the big US banks, Bank of America, JP, Morgan, Wells, Fargo, Goldman, Sachs,
[8:34] Speaker 2: and City all on the same day, and then later
[8:37] Speaker 2: in the week we'll hear from ASML and TSMC. And Thursday,
[8:42] Speaker 2: the numbers from Netflix US listed chairs and sk Heinez
[8:46] Speaker 2: debuted last Friday with a gain of more than twelve percent. However,
[8:49] Speaker 2: today in Seoul shares are down as much as seven
[8:52] Speaker 2: point two percent. We got the view on markets from
[8:55] Speaker 2: Bloomberg strategist Mark Cranfield. He spoke with Bloomberg TV host
[8:59] Speaker 2: Averril Honk and their conversation started with a question from
[9:03] Speaker 2: April on the market's reaction to these fresh attacks in
[9:06] Speaker 2: the war between the US and Iran.
[9:08] Speaker 5: Is very big for this inflation. You can see it
[9:10] Speaker 5: in the reaction of the treasury futures and the way
[9:13] Speaker 5: that treasury yields have been gradually climbing over the past
[9:16] Speaker 5: few weeks. Is that bond markets especially seem to be
[9:18] Speaker 5: the most sensitive to the changes in the oil prices.
[9:21] Speaker 5: Plus they're almost taking on the life of their own
[9:24] Speaker 5: because they are expecting the Federal Reserve to raise interest
[9:26] Speaker 5: rates before the end of the year. So you've got
[9:28] Speaker 5: a couple of themes running there. And of course the
[9:30] Speaker 5: flip side is the US dollar. It's getting stronger as
[9:33] Speaker 5: well as now. The good morning so far for the currency.
[9:36] Speaker 5: So in terms of the oil prices, as was being mentioned,
[9:40] Speaker 5: the oil futures print in particular around the eighty dollars
[9:43] Speaker 5: mark that seems to be the threshold at which the
[9:46] Speaker 5: markets will really take notice. It's failed a couple of
[9:48] Speaker 5: times in recent weeks. It's gone up there, come back
[9:50] Speaker 5: down again. Where a couple of dollars away this morning,
[9:53] Speaker 5: So it really depends on and if you look at
[9:56] Speaker 5: positioning in the market, it's relatively light at the moment,
[9:59] Speaker 5: so push through that eighty dollars line if we get
[10:02] Speaker 5: continued attacks here and uncertainty about where the whole moves
[10:05] Speaker 5: is going. So that's really what all asset markets will
[10:09] Speaker 5: be watching that very closely. If we get a close
[10:11] Speaker 5: this week above eighty dollars, it could be very negative
[10:14] Speaker 5: right across the board for markets.
[10:15] Speaker 6: So that could also affect the memory trait even after
[10:18] Speaker 6: sq Heinex's dem.
[10:19] Speaker 5: Well, the interesting thing there, if you think back to March,
[10:22] Speaker 5: when the US around war first started, tech was seen
[10:25] Speaker 5: as being almost as like a hedge against what's going
[10:28] Speaker 5: on in the rest of the asset world because people
[10:30] Speaker 5: are seeing that slightly higher interest rates, slightly higher oil
[10:35] Speaker 5: is not that material to what's happening in terms of
[10:38] Speaker 5: earnings for the tech picture, that the AI story is
[10:41] Speaker 5: somehow removed from that. So again, the Heinex could be
[10:44] Speaker 5: coming at just the right time. From that point of view,
[10:46] Speaker 5: they're listing their or a dr there's renewed interest in
[10:49] Speaker 5: tech stocks in Asia and the memory story building these
[10:53] Speaker 5: storage facilities. That's all coming back at the time where
[10:56] Speaker 5: maybe we're going to see disconnect in other asset classes,
[10:59] Speaker 5: but people reverting back to the stories which they enjoyed
[11:02] Speaker 5: so much in the March April period, and they may
[11:05] Speaker 5: well end up being a good thing for Enix.
[11:08] Speaker 6: What about this week when we're watching for what Kevin
[11:11] Speaker 6: wash says on the Hill. I mean, there's been so
[11:14] Speaker 6: much repricing going on around the comments he's given as well.
[11:18] Speaker 5: He's trying not to give things away. We know very
[11:20] Speaker 5: well that he doesn't like forward guidance. He's going to
[11:23] Speaker 5: have trouble keeping to that path. The Senate is usually
[11:26] Speaker 5: pretty diligent. They want the answers to their questions and
[11:29] Speaker 5: they will be badgering him. Where do you see inflation going?
[11:32] Speaker 5: How long until you raise interest rates? All of those
[11:34] Speaker 5: things will be thrown at him and he will probably
[11:36] Speaker 5: find it pretty tough not to answer those questions. So
[11:39] Speaker 5: we are likely to understand a lot more about his
[11:42] Speaker 5: thinking this week than we have previously. So yes, a
[11:45] Speaker 5: very very important session in terms of US markets, particularly
[11:49] Speaker 5: for people that expect a Federal Reserve interest rate hike
[11:52] Speaker 5: this year. We may well get more details about when
[11:56] Speaker 5: the timing could be for such a move.
[11:58] Speaker 6: So what does this mean for the yen? On Friday,
[12:01] Speaker 6: we did see a bit of a rally of mini
[12:02] Speaker 6: one right following Kadayama's comments.
[12:05] Speaker 5: It really tells you how significant this whole story around
[12:07] Speaker 5: the pension funds in Japan is. It's almost their last
[12:10] Speaker 5: roll of the dice if they actually are serious about
[12:14] Speaker 5: wanting to change the direction of the yen. It's clear
[12:16] Speaker 5: Bank of Japan policy is not helping them. All the
[12:19] Speaker 5: times that they intervene with various comments about the being weak,
[12:23] Speaker 5: that's not helping either. But if they can persuade the
[12:27] Speaker 5: Japanese the major pension fund to change its assets coming
[12:30] Speaker 5: back to Japan, that would in turn probably trigger similar
[12:33] Speaker 5: moves in other pension funds. We're talking about a couple
[12:36] Speaker 5: of trillion dollars worth of assets which are held outside Japan.
[12:39] Speaker 5: If we start to see that flow back into the
[12:42] Speaker 5: country on a regular basis, you have a sustained buying
[12:45] Speaker 5: of yen FX traders who so far being fairly immune
[12:48] Speaker 5: to it. They will stand up and notice when you
[12:50] Speaker 5: tell them there's a consistent bid for the currency from
[12:54] Speaker 5: a major source, that will start to change their behavior.
[12:57] Speaker 5: It shows just how important that is. Without it, the
[13:00] Speaker 5: yendsday's a very weak currency.
[13:01] Speaker 2: That's Bloomberg strategist Mark Cranfield speaking earlier with Bloomberg TV
[13:05] Speaker 2: host Avril Hong, bringing you their conversation here on the
[13:09] Speaker 2: Daybreak Asia Podcast. Thanks for listening to today's episode of
[13:13] Speaker 2: the Bloomberg Daybreak Asia Edition podcast. Each weekday, we look
[13:18] Speaker 2: at the story shaping markets, finance, and geopolitics in the
[13:21] Speaker 2: Asia Pacific. You can find us on Apple, Spotify, the
[13:25] Speaker 2: Bloomberg Podcast YouTube channel, or anywhere else you listen. Join
[13:29] Speaker 2: us again tomorrow for insight on the market moves from
[13:32] Speaker 2: Hong Kong to Singapore and Australia. I'm Doug Chrisner, and
[13:36] Speaker 2: this is Bloomberg

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