Weekend:

Friday:

Summary:

Oil traded in a narrow range as US-Iran talks remained stalled and Hormuz shipping continued at a trickle, with no tankers moving oil on Friday.
Iran said the Strait of Hormuz will stay shut until the US “accepts defeat,” while Trump told Americans over the weekend to expect higher gasoline prices.
IRGC Political Deputy Yadollah Javani said Iran’s actions so far have been defensive but could become offensive, while Deputy Foreign Minister Kazem Gharibabadi and Foreign Minister Abbas Araghchi reiterated that any reopening of the strait remains on Iran’s terms.
Japan’s Q2 GDP grew a weaker than expected 0.3% q/q (1.1% annualised), but the yen firmed toward 159 to the dollar as traders instead focused on fading Fed rate hike expectations.
The dollar broadly lost ground following last week’s data flow, including a soft US retail sales print on Friday.
Singapore’s July non-oil domestic exports rose 24.2% y/y, just shy of forecast, extending a fourth straight month of growth above 20% on AI-linked electronics demand.
Asia-Pacific stocks traded mixed in quiet holiday-thinned trade, with South Korean markets closed and uncertainty building with the expiry of the 60-day US-Iran ceasefire.

Oil prices moved in a narrow range between small gains and losses on Monday, with US-Iran talks still stalled and shipping through the Strait of Hormuz continuing only in trickle volumes. No tankers moved oil through the strait on Friday, according to tracking firms, and negotiations showed no sign of resuming as the new week began.

Tehran maintained its hard line over the weekend. Iran’s Deputy Foreign Minister Kazem Gharibabadi said Saturday that the Strait of Hormuz would remain closed until Washington accepts what he characterised as its defeat, while Foreign Minister Abbas Araghchi said Iran had not yet decided whether to resume talks with the US and set conditions for shipping to resume through the waterway. IRGC Political Deputy Yadollah Javani said Iran’s actions to date have been defensive in nature but could take on an offensive character going forward. President Trump, addressing a rally on Friday, said Americans should be prepared to accept somewhat higher gasoline prices and floated the possibility of eventually declaring the strait US territory.

In Asia, Japan’s economy expanded 0.3% quarter on quarter in the April to June period, well below the 0.5% forecast, with annualised growth of 1.1% missing expectations of 2.0% as weak capital expenditure and flat consumption weighed on domestic demand. Despite the soft print, the yen edged higher against the dollar, rising to just under 159, a second consecutive day of gains, as traders focused more on pushed-back expectations for a Federal Reserve rate hike this year than on the domestic data. The move came alongside broader dollar weakness following last week’s data flow, including a soft US retail sales report on Friday.

Singapore’s non-oil domestic exports rose 24.2% year on year in July, just below the 25% forecast, marking a fourth consecutive month of growth above 20% as AI-linked electronics demand continued to offset weaker non-electronics shipments.

Asia-Pacific equities traded mixed following a quiet weekend for macro newsflow, with South Korean markets closed for a public holiday and investors weighing uncertainty as the 60-day US-Iran ceasefire period approaches its expiry.

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Note, still to come – China data due at 3pm beijing time, delayed today: