MARKET AT 7
Good evening. Central banks did all the talking today and they didn't see eye to eye. Japan hikes, Britain stays, Australia’s governor nearly told parliament a move’s coming.were in the spotlight
In tonight's newsletter:
Bank of Japan hikes to 31-year high, yen falls anyway
RBA hike odds jump as Bullock warns inflation risks are back
Oil slips as Trump flags a possible end to the Iran war
Wall Street claws back most of its Fed-hike losses, tech leads
Gold, bitcoin and copper rally together as bond yields ease
Bank of Japan hikes to 31-year high, yen falls anyway
The Bank of Japan raised its policy rate a quarter point to 1.25% on Friday, the highest level since 1995 and its second hike in three months, the fastest pace of tightening since 1990. The board split 7-2, with members Toichiro Asada and Ayano Sato voting to hold, CNBC reports. Governor Kazuo Ueda told reporters there's no "specific timeframe" for further hikes and the bank will keep watching the Middle East conflict, AI-driven demand and exchange rates, the ABC reports. The yen still slipped to around 157 per dollar after the decision. Source: CNBC, 18 Sep 2026 → · Source: ABC News, 18 Sep 2026 →
OUR TAKE:
A rate hike that weakens your currency is a strange result, but it makes sense here. Two dissenting votes told traders Ueda isn't as committed to a fast pace as the headline number suggests.
BA hike odds jump as Bullock warns inflation risks are back
RBA governor Michele Bullock told a parliamentary committee in Canberra on Friday that some of the upside inflation risks flagged in August "appear to be materialising," even as economic growth slows, and warned the war in the Middle East is making Australia poorer through elevated petrol prices. Traders lifted the odds of a hike at the 29 September board meeting to roughly 90%, up from about 84% before the testimony, Bloomberg reports. Westpac chief economist Luci Ellis has now brought her call forward to September too, joining NAB, and expects the board to split on the vote. Source: Bloomberg via Market Index, 18 Sep 2026 → · Source: ABC News, 18 Sep 2026 →
OUR TAKE:
Bullock didn't announce a hike today. She didn't need to. Telling parliament your own forecasts might be wrong is about as close as a central banker gets to saying it out loud.
Oil slips as Trump flags a possible end to the Iran war
Brent crude fell for a third straight session, down 1.7% to $103.07 a barrel, even after fresh strikes between Saudi Arabia and Yemen's Houthi forces, as traders weighed Saudi Arabia's progress restoring capacity on its damaged East-West pipeline. President Trump said the US is "hopefully" nearing the end of the nearly seven-month war and has spoken with Tehran directly, with Gulf Cooperation Council leaders due to meet on the sidelines of the UN General Assembly next Tuesday. Commonwealth Bank's Carol Kong puts the odds of a US-Iran deal within five weeks at 85%. Source: Market Index, 18 Sep 2026 → · Source: ABC News, 18 Sep 2026 →
OUR TAKE:
Oil traders are pricing in an ending. Whether Tehran and Washington actually reach a deal is a different question, and the market has misjudged this situation before.
Wall Street claws back most of its Fed-hike losses, tech leads
The Dow rose 316.14 points, or 0.61%, to close at 51,778.04 on Thursday, while the S&P 500 gained 1.14% to 7,637.76 and the Nasdaq added 1.69% to 26,418.30, recovering most of the ground lost after Wednesday's Fed rate rise, Yahoo Finance reports. Nvidia and Amazon each rose more than 2%, Microsoft added 1.5% and Intel jumped 7%, as falling Treasury yields and easing oil prices pulled buyers back into tech. Source: Yahoo Finance, 18 Sep 2026 →
OUR TAKE:
One good session doesn't undo a rate hike. It just tells you traders think the Fed's done enough for now, whether or not that turns out to be true.
Gold, bitcoin and copper rally together as bond yields ease
Gold rose 1.2% to around $4,392 an ounce and bitcoin gained 1.3% to about $77,484, while copper climbed roughly 2.7% in early trade and held most of that through the day, the ABC's market snapshot shows. The US 10-year Treasury yield eased to 4.94%, its first dip below 5% in more than a week, taking pressure off both the safe-haven trade and leveraged crypto positions. Source: ABC News, 18 Sep 2026 →
OUR TAKE:
Not every rally needs a story. Yields came down a little, and everything priced against them went up. That's the whole explanation tonight.
QUICK HITS
ASX ends flat as miners rally, banks and energy lag. The ASX 200 finished down 1.2 points at 8,731 on Friday, with Materials (+1.5%) and Utilities (+0.7%) the only sectors higher, while Energy (-1.2%), Telecommunications (-1.1%) and Consumer Staples (-1%) dragged, ABC News reports. The Australian dollar rose 0.2% to 71.25 US cents. Our take: a flat index hides a genuinely split day. Gold miners partied while everything tied to the Middle East got smaller.
Bank of England holds rates, flags a possible December hike. The Bank of England kept its Bank Rate at 3.75% in a 6-3 split vote on Wednesday, even as UK inflation hit 3.1% in August, with markets now seeing a hike as more likely than not at one of the next two meetings, the Bank's own minutes show. Our take: three central banks, three different calls this week. Nobody's actually sure inflation is under control, they're just guessing differently about how to respond.
New Zealand's services sector edges back into growth. The BNZ-BusinessNZ Performance of Services Index rose to 51.2 in August from 50.6 in July, moving further above the 50-point growth line after June's soft GDP print, interest.co.nz reports. Our take: it's a small number, but a services sector climbing out of a slump is a better sign for the RBNZ than another month of the same.
Those are your 5 minutes for tonight; see you at the same time tomorrow. - Miko Santos