PiCK
Bessent Says Oil Will Fall After Iran Tensions Pass; Calls Core Inflation Benign
Summary
- Bessent said global oil prices will decline once tensions with Iran ease.
- He said the yen will strengthen as Japan's government and the BOJ act, while markets are closely watching the dollar-yen exchange rate.
- Bessent said core inflation is very benign and that the US bond market and the 30-year yield are showing solid performance.
Forecast Trend Report by Period
US Treasury Secretary Scott Bessent said global oil prices will fall once the conflict with Iran passes. He also said he expects the yen to strengthen as Japan's government and the Bank of Japan respond.
Walter Bloomberg reported on August 31 that Bessent told CNBC, "Once we get past the Iran conflict, oil prices will come down." On US policy toward Iran, he said the goal is to create conditions that would bring Tehran to the negotiating table.
Bessent said he believes Japan's government and the BOJ will take steps that lead to a stronger yen. The dollar-yen exchange rate was trading around 160 yen that day, with markets focused on the possibility of intervention by Japanese authorities.
On interest rates, Bessent said policymakers traditionally do not raise rates in response to supply shocks. He also described core inflation as "very benign." He declined to speculate on the Federal Reserve's next move.
On the US bond market, Bessent said he does not think he can change the equilibrium price. He added that the US Treasury market is performing well and that the 30-year yield has also moved lower. He also said he has not bought anything yet.
Bessent also said the US is not in a trade war with Canada.
Minseung Kang
minriver@bloomingbit.ioBlockchain journalist | Writer of Trade Now & Altcoin Now, must-read content for investors.