US makes big economic threats at Iran; Iran blacklists tankers; US economic activity weakens; Canada gets new tariff threat; Singapore inflation up, baby bonus expanded; UST 10yr at 4.70%; gold rises and oil dips; AU$1 = 71.4 USc;

Here's our summary of key economic events overnight that affect Australia, with news the US has announced the start of “Operation Economic Outcast” aimed at isolating Iran from the rest of the world. It is a move that comes after a failed military campaign. It's effectiveness will largely depend on China and Russia. Prospects for this retribution strategy working don't seem very high. For the rest of us, the danger here is that the US can just make up claims of violations at its discretion to bully is view.

Meanwhile, Iran said it had blacklisted 45 tankers that had broken its rules for crossing the Strait of Hormuz, and would take action against ​any vessels transferring loads with them.

In the US, the Chicago Fed's National Activity Index retreated in July, with personal consumption and the housing category weakened sharply from June. There are four categories in this assessment; two were positive (just) but down from June, one improved from June but is still negative, and one retreated from a positive June to a sharply negative in July.

In Canada they posted a dip in July manufacturing sales, their first in five months. Things will get tougher for this sector, especially truck manufacturing for export to the US, with Trump threatening new 50% tariffs. (He is doing more of the things that haven't worked in the past, which is the definition of something.)

Singapore's inflation came in slightly higher at 2.2% in July than the expected +2.1% and the June 1.8%. In fact, it was their highest since August 2024. Food prices were also up +2.2%.

And Singapore has sharply upgraded its incentives for having children. Parents will now get up to S$70,000 per child over their first 17 years, S$10,000 in the first year. To be fair this is a extension of existing schemes, but a notable one.

The UST 10yr yield is now just on 4.70%, down -4 bps from yesterday at this time. The 30 year yield is at 5.23%, down -5 bps. The key 2-10 yield curve is now at +46 bps (down -4 bps). Their 1-5 curve is now at +38 bps (-2 bps) and the 3 mth-10yr curve is at +100 bps (-3 bps). The China 10 year bond rate is down -2 bps at 1.68%. The Japanese 10 year bond yield is now at 2.88%, unchanged. The Australian 10 year bond yield starts today at 4.99%, down -4 bps from yesterday. 

Wall Street has started its week with the S&P500 down -0.2% and the Nasdaq down -0.6%. European markets started mixed between London's +0.3% rise and Paris's -0.4% fall. Yesterday Tokyo ended down -0.7%. Hong Kong fell a sharper -1.9% and Shanghai was down -0.6%. Singapore dipped -0.1%. The ASX200 ended its Monday session up +0.5% and the best of the markets we follow.

The price of gold is now at US$4636/oz, up +US$29 from yesterday at this time. Silver has dipped -50 USc to just over US$68.50/oz.

Oil prices are down -US$2 from yesterday at just under US$85/bbl in the US, while the international Brent price is just under US$92/bbl and down -US$2.50. Hormuz transits have fallen back with no tankers and 10 cargo ship exiting over the past 24 hours (2 dark with transponders off) and six entering for new loads (3 dark). The Red Sea activity is back down to about 20 each way at the Yemen chokepoint.

The Australian dollar is down -30 bps from yesterday at just over 71.4 USc. Against the Japanese yen we are down -30 bps at ¥113.7. Against the euro we are also down -10 bps at 61.3 euro cents.

The bitcoin price starts today at US$78,855 up +2.2% from yesterday at this time. Volatility over the past 24 hours has remained modest at just on +/-1.3%.