Energy Surges as Geopolitical Tensions Mount; Gold Rallies Amid Cooling Fed Hike Bets
Natural gas and crude prices climbed significantly this week, while upcoming US CPI and China's loan prime rate decision will shape the week ahead.
The story
Global energy markets saw substantial gains this week, primarily driven by escalating geopolitical tensions. Brent crude futures advanced, adding 5.9% for the week, as the ongoing conflict in the Middle East intensified. The U.S. is reportedly considering maintaining its naval blockade of Iran indefinitely, further disrupting shipping through the Strait of Hormuz and raising concerns about oil supply.
Meanwhile, expectations for a September Federal Reserve interest rate hike cooled significantly following a downside surprise in July nonfarm payrolls and a mild pullback in CPI. This shift in sentiment led to a retreat in both the US dollar and US Treasury yields. The US 10-year Treasury yield pulled back from 4.70% to around 4.67%, while July US retail sales contracted by 0.6% month-over-month.
Central banks continued to bolster their gold reserves, reinforcing the metal's role in reserve diversification. Spot gold rallied from approximately $4,240 to above $4,440, hitting a two-month high. The People's Bank of China reported its gold reserves reached 76.08 million ounces at the end of July, an increase of about 19.9 metric tons, marking the 21st consecutive month of accumulation.
Energy and metals
Commodities saw strong upward movement this week, with TTF Natural Gas leading the charge and Brent Crude also posting a notable advance. WTI Crude followed a similar upward trajectory. Gold extended its quiet grind higher, gaining momentum. In the FX space, the USD strengthened against the Saudi Riyal and Brazilian Real, while showing a modest rise against the Japanese Yen. US Treasury yields saw mixed movements, with the 10-year note ticking higher and the 30-year bond also advancing, though the 3-month T-bill experienced a slight decline.
| Instrument | Now | 24h | 7d | MTD | YTD |
|---|---|---|---|---|---|
| Brent Crude | 88.52 USD/bbl | +1.7% | +5.9% | -1.8% | +45.5% |
| WTI Crude | 82.40 USD/bbl | +1.4% | +5.4% | -2.7% | +43.5% |
| TTF Natural Gas | 61.42 EUR/MWh | +1.7% | +10.6% | +4.0% | +118.1% |
| Henry Hub Natural Gas | 2.73 USD/MMBtu | +0.2% | +2.7% | -0.5% | -25.9% |
| Gold | 4,437.30 USD/oz | +1.7% | +2.2% | +9.6% | +2.6% |
Currencies vs the dollar
| Pair | Now | 24h | 7d | YTD |
|---|---|---|---|---|
| USD / CNY | 6.742 | -0.0% | -0.1% | -3.6% |
| USD / JPY | 159.305 | -0.1% | +0.9% | +1.8% |
| EUR / USD | 1.157 | +0.3% | +0.4% | -1.5% |
| USD / ARS | 1,487.500 | -0.3% | -0.8% | +2.5% |
| AUD / USD | 0.709 | +0.3% | +0.3% | +5.8% |
| USD / BRL | 5.213 | +0.3% | +1.8% | -4.8% |
| USD / CAD | 1.387 | -0.4% | -0.6% | +1.3% |
| GBP / USD | 1.353 | +0.3% | +0.3% | +0.5% |
| USD / IDR | 17,820.000 | -0.2% | +0.1% | +6.6% |
| USD / INR | 95.430 | +0.0% | +0.2% | +6.3% |
| USD / KRW | 1,412.000 | -0.3% | +0.4% | -1.8% |
| USD / MXN | 17.015 | -0.1% | -1.1% | -5.4% |
| USD / RUB | 84.175 | +1.3% | +1.4% | +5.9% |
| USD / SAR | 3.754 | +3.8% | +3.1% | +0.2% |
| USD / TRY | 47.861 | -0.0% | +0.4% | +11.4% |
| USD / ZAR | 16.166 | -0.1% | +0.1% | -2.5% |
US Treasury curve
| Maturity | Yield | Week | YTD |
|---|---|---|---|
| US 3M T-Bill | 3.697% | -1bp | +15bp |
| US 5Y Note | 4.362% | +0bp | +64bp |
| US 10Y Note | 4.696% | +4bp | +53bp |
| US 30Y Bond | 5.265% | +5bp | +42bp |
Central banks this week
Federal Reserve (Fed). Expectations for a September rate hike cooled significantly.
Market probabilities for the Fed holding rates steady in September rose to about 67%, reflecting a less hawkish outlook due to recent economic data.
People's Bank of China (PBoC). Maintained loan prime rates and continued gold accumulation.
China's benchmark loan prime rates are expected to remain steady at 3.0% and 3.5% for one-year and five-year rates, respectively. The PBoC also increased gold reserves by 19.9 metric tons in July, marking 21 consecutive months of additions.
Bank of Canada (BoC). Expected to hold its overnight rate.
The BoC is anticipated to keep its overnight rate unchanged at 2.25% in its upcoming statement-only decision.
Sveriges Riksbank. Widely expected to hold policy rate.
Sweden's central bank is largely expected to maintain its policy rate at 1.75% during its next meeting.
Reserves — who holds what, who is moving
Official sector reserve movements highlighted a continued trend in gold accumulation. The People's Bank of China notably increased its gold reserves for the 21st consecutive month, adding approximately 19.9 metric tons in July alone. This sustained buying from China underscores a broader push among some nations to diversify their holdings, potentially signaling a reduced reliance on dollar-denominated assets. Among the top FX reserve holders, China maintains the largest position, followed by Japan and Switzerland, indicating the persistent global distribution of currency reserves.
FX reserves — top 15 (excluding gold)
| Country | Reserves USD | As of |
|---|---|---|
| China | $3,424.9B | 2025 |
| Japan | $1,252.6B | 2025 |
| Switzerland | $929.6B | 2025 |
| Euro area | $594.4B | 2025 |
| India | $576.5B | 2025 |
| Saudi Arabia | $459.8B | 2025 |
| Korea, Rep. | $421.9B | 2025 |
| Singapore | $404.9B | 2025 |
| Brazil | $334.3B | 2025 |
| United Arab Emirates | $281.9B | 2025 |
| Thailand | $249.3B | 2025 |
| United States | $243.3B | 2025 |
| Mexico | $239.3B | 2025 |
| Israel | $229.5B | 2025 |
| Poland | $194.5B | 2025 |
Fuel + pump prices
| Fuel | Benchmark / pump | Driver + passthrough |
|---|---|---|
| Petrol (Gasoline) | London: 146.63 pence/litre; Delhi: ₹102.12/litre; Mumbai: ₹111.21/litre; NYC: $4.1356/gallon; Dubai (Super 98): AED 3.60/litre | Retail petrol prices across major cities remained sensitive to global crude oil fluctuations and regional tax structures. |
| Diesel | London: 164.26 pence/litre; Delhi: ₹95.20/litre; Mumbai: ₹97.83/litre; NYC: $5.6094/gallon; Dubai: AED 3.80/litre | Diesel prices largely held steady in India despite global market trends, while experiencing shifts in other international hubs. |
| LPG (Domestic Cylinder) | Delhi (14.2kg): ₹942.00; Mumbai (14.2kg): ₹941.50 | LPG cylinder prices in major Indian cities remained stable, influenced by government policies and global crude oil prices. |
| Marine Gasoil (MGO 0.5%S) | Singapore: $1226.00/MT | Bunker fuel prices in Singapore, a major shipping hub, reflected ongoing demand and supply dynamics in the marine fuel market. |
| Very Low Sulphur Fuel Oil (VLSFO) | Singapore: $831.00/MT | VLSFO prices in Singapore continued to track global oil benchmarks and regional bunkering activity. |
| High Sulphur Fuel Oil (HFO 380) | Singapore: $627.50/MT | HFO 380 prices in Singapore demonstrated stability, influenced by heavy fuel oil market conditions. |
What we’ll be watching this week
- August 17: Canada CPI for July
- August 17: US CPI for July
- August 17: China high-frequency real sectors data and new/used house prices
- August 19: China banks set Loan Prime Rates
- August 20: US FOMC Meeting Minutes
- August 26: Fed Chair Warsh speaks at Jackson Hole
- Australia's Q2 wage price index
- Japan Q2 GDP
Markets, FX, reserves: fmd-data (). Central bank moves + fuel benchmarks + calendar: grounded via Google Search at publish time.