Asia Summary and Highlights 26 May
Rubio says Hormuz will open one way or another
U.S. forces sank two IRGC vessels laying mines in the Strait of Hormuz and struck a surface-to-air missile site at Bandar Abbas
Iran launched anti-ship cruise missiles at US Navy assets in response
Asia Session
Explosions were heard in Iran earlier and was reported that U.S. forces sank two IRGC vessels and Iran launched anti-ship cruise missiles in response. The U.S. framed such action as defensive and suggest the ceasefire continues as both sides are heading towards the finish line of a deal. U.S. major equity indexes have erased most Monday gains on the renewed bombing. AUD/USD is trading 0.17% lower at 0.7163. NZD/USD is trading 0.42% while USD/CAD is trading 0.07% higher as both Brent and WTI rose by more than a dollar/b.
With no deal announced and explosions heard, market participants scaled back their optimism and sees the initial euphoria fading. BoJ's deputy governor reaffirmed their rate hike path in a testimony in front of the Diet but points out Middle East conflict to be key in timing. USD/JPY is trading 0.08% higher at 159.00. Else, EUR/USD slips 0.09% and GBP/USD slips 0.22%.