Global Markets Brace for Warsh's Jackson Hole Debut Amid Regional Cracks
28 August 2026 · Evening
Global markets are holding their breath ahead of Fed Chair Kevin Warsh's inaugural Jackson Hole speech, which could provide crucial signals on future monetary policy.
Meanwhile, economic cracks are appearing in Europe and emerging markets, with France's Q2 GDP revised down to 0.0% and the Philippine Peso hitting a record low.
Despite these regional concerns, US equities saw a second day of gains, while Brent crude experienced its first weekly decline in three weeks.
Bond markets, however, showed a hawkish tilt with US Treasury yields rising, suggesting anticipation of a firm stance from the Fed.
Asian markets faced significant headwinds today as inflationary pressures intensified across the region.
Global Markets
Detail
S&P 500
Closed at 7,730.99 on 8/27
+0.72%
Nasdaq
Closed at 26,541.35 on 8/27
+1.57%
STOXX 600
Intraday at 655.16 as of 19:42 KST on 8/28
+0.51%
Nikkei 225
Closed at 66,405.34 on 8/28
+0.41%
CSI 300
Closed at 4,609.18 on 8/28
-0.46%
KOSPI
Closed at 6,788.88 on 8/28
-1.79%
Hang Seng
Closed at 25,584.79 on 8/28
+0.07%
Dollar Index (DXY)
Closed at 99.18 on 8/28
+0.05%
USD/JPY
Closed at 159.65 on 8/28
+0.16%
EUR/USD
Closed at 1.16 on 8/28
-0.05%
USD/KRW
Closed at 1,373.62 on 8/28
-0.47%
USD/CNY
Closed at 6.72 on 8/28
+0.02%
US 10-year yield
Closed at 4.676% on 8/27
+2.7bp
US 2-year yield
Closed at 4.234% on 8/27
+2.5bp
Japan 10-year yield
Closed at 2.928% on 8/28
+3.6bp
Germany 10-year yield
Intraday at 3.276% as of 19:42 KST on 8/28
+0.9bp
Korea 10-year yield
Closed at 4.274% on 8/28
+2.2bp
US HY Spread
Closed at 267bp on 8/26
-3.0bp
WTI
Closed at 83.25 on 8/28
-0.34%
Gold
Closed at 4,603.62 on 8/28
+0.03%
Copper
Closed at 6.73 on 8/28
+2.15%
VIX
Closed at 14.50 on 8/27
-4.73%
United States
Fed Chair Warsh's Jackson Hole DebutFocus
Fed Chair Warsh is set to deliver his inaugural official speech at the Jackson Hole Symposium, with markets keenly awaiting signals on inflation policy.
July Personal Consumption Expenditures (PCE) rose 3.7%, marking 65 consecutive months above the Fed's 2% target.
Futures markets price in a 61% chance of a rate freeze in September but a 76% chance of a hike by December, indicating internal committee tensions.
US Seeks Venezuela Oil AccessNegotiations
The US government is reportedly negotiating long-term access to certain Venezuelan oil fields, aiming for development by US companies.
High-level talks are underway between Caracas and Washington, with Venezuela also rumored to be considering an exit from OPEC.
This potential agreement could face constitutional challenges and legal hurdles.
Dollar Strength Ahead of Warsh SpeechStable
The dollar maintained its level near a one-week high, despite a two-month consecutive weakening trend on a monthly basis.
USD/JPY rose from 159.30 to 159.65, approaching its August 18 high of 159.78, while the yen gave back some gains from Japanese intervention.
Traders are holding significant dollar long positions, with about $38 billion remaining from a July peak of $51 billion.
Upcoming US Economic CalendarBusy Week
Next week features key US employment data, with August job growth expected at 45,000, and the S&P 500 within 1% of its all-time high.
Other central bank decisions include an expected 25bp hike by the RBNZ to 2.75% and a likely rate freeze by the Bank of Canada at 2.25%.
Broadcom (AVGO) earnings are also due, and the G20 Finance Ministers and Central Bank Governors meeting will prioritize global economic growth.
South Korea Backs Trump on North KoreaDiplomacy
South Korea's National Security Advisor expressed support for US efforts to resume dialogue with North Korea.
Concerns were raised about potential weakening of South Korea's security posture and marginalization.
South Korea seeks deeper cooperation with the US on investment, information sharing, and wartime operational control transfer.
NVIDIA (NVDA)-1.59%
Reported Q2 adjusted EPS of $2.22, exceeding consensus of $2.10, and revenue of $96.221 billion, marking an earnings surprise.
Issued Q3 revenue guidance of $108 billion, above consensus of $104.193 billion, and projected FY28 revenue growth of +70% year-over-year.
Acknowledged supply bottlenecks are expected to persist until late FY28, with future purchase commitments expanding to $279 billion.
Meta Platforms (META)+1.07%
Reached a settlement of up to $18 billion with multiple U.S. states and territories over claims of social media harm to youth, with court approval finalized.
Agreed to implement minor protection measures on Instagram and Facebook for 10 years, including night notification blocks and default daily usage limits.
Poland's digital minister formally requested the EU to fine Meta €250 million for inadequate handling of fraudulent ads and online scams.
SanDisk (SNDK)+1.26%
Announced a joint investment with Kioxia of 5 trillion yen (over $31 billion) in new memory production facilities in Japan over the next six years.
The investment aims to address increasing memory chip demand driven by AI, with plans for a new facility at Kioxia's Kitakami plant.
Implementation of the investment is contingent on financial support from the Japanese government.
JPMorgan Chase (JPM)-0.05%
Clash intensified among Wall Street banks over the Fed's capital rule reforms, with JPMorgan potentially facing up to a $13 billion impact on its capital.
The bank, along with Bank of America, urged the Federal Reserve to reverse adjustments to GSIB capital rules, arguing current proposals would deny them $13 billion in capital relief.
An investigation by Congress is ongoing regarding former executive Staley's alleged sharing of confidential information related to Epstein.
Moderna (MRNA)-5.77%
Announced plans for a $2 billion private offering of convertible senior notes, leading to a -5.6% drop in pre-market trading.
The offering raises concerns about potential dilution of existing shareholders if the notes are converted into new shares.
The company plans to purchase separate hedge overlay transactions to offset dilution up to a 150% increase from the current stock price.
Amgen (AMGN)-0.43%
Its drug Tezspire met all primary and secondary endpoints in a Phase 3 trial for eosinophilic esophagitis, demonstrating treatment efficacy.
The safety profile of Tezspire was consistent with its previously approved indications.
Alphabet (GOOGL)-1.43%
Waymo began autonomous driving tests in Munich, targeting commercialization by late 2027.
Barret Zoph, co-founder of Thinking Machines Lab, joined Google as Vice President of AI Research.
Southern Company (SO)-0.23%
Georgia Power's contract to supply 3,200 megawatts of electricity to OpenAI received regulatory approval from the Georgia Public Service Commission.
OpenAI agreed to cover all infrastructure costs, providing Southern Company with a new long-term revenue stream without capital investment burden.
Residential customers are expected to save over $15 per month starting in 2029, based on 1,000 kWh usage.
GE Vernova (GEV)+2.84%
Partnered with construction firm Laing O'Rourke to supply advanced power transmission technology to National Grid, the UK power grid operator.
The contract supports the modernization of power transmission networks across England and Wales, enhancing energy infrastructure.
DigitalOcean Holdings (DOCN)+2.15%
Truist Securities initiated coverage with a 'Buy' rating and a price target of $175.
Johnson & Johnson (JNJ)-1.15%
Its oral psoriasis treatment, icotrokinra, received regulatory approval in China for moderate-to-severe plaque psoriasis.
The approval targets a large market of over 8.4 million psoriasis patients in China, intensifying competition with existing treatments.
AbbVie (ABBV)-1.09%
Submitted a regulatory approval application to the European Medicines Agency (EMA) for Skyrizi (risankizumab) subcutaneous injection as an early treatment for moderate-to-severe Crohn's disease in adults.
Visa (V)-0.06%
Launched three new cybersecurity advisory services to address the AI era, enhancing its offerings to clients.
Is collaborating with local financial institutions like Fransabank Lebanon and Payfera to conduct the first live test of international card payment services in Syria.
Mastercard (MA)-0.15%
Syria completed its first international card transactions in over 15 years with Mastercard and QNB Group.
This marks a significant step towards reconnecting Syria's payment ecosystem with Mastercard's global network and expanding digital payments in emerging Middle Eastern markets.
Europe
France Q2 GDP Stagnates0.0%
France's Q2 GDP was revised down to 0.0% from an initial estimate of +0.2%, falling short of market consensus.
Exports saw a strong rebound in aviation, up 2.9% from -3.0% previously, but this was overshadowed by weak household consumption and services.
The Finance Minister described initial post-summer economic figures as 'horrible,' raising warnings for annual growth and fiscal deficit targets.
Positive Economic Signals in Sweden and SwitzerlandAbove Estimates
Sweden's Q2 GDP grew by 1.6% quarter-on-quarter (consensus 1.4%), driven by broad-based growth in fixed capital formation and improved household sentiment.
Switzerland's KOF Economic Barometer rose to 106.7 in August, significantly exceeding market expectations of 103.3 and July's revised 104.2, signaling improved economic prospects.
Eurozone Economic Sentiment Improves98.4
The Eurozone Economic Sentiment Indicator rose to 98.4 in August from 97.1 in July, showing broad recovery across industry, services, and retail.
Producer price expectations eased from 17.8 to 16.4, suggesting weakening inflationary pressure, while consumer price expectations rose from 30.4 to 33.0.
Italian household confidence improved slightly to 94.5 (vs. 94.2 prior), and business confidence rose for the third consecutive month to 96.9.
Spain Inflation Accelerates+4.5%
Spain's August HICP accelerated to 4.5% year-on-year (vs. 3.9% in July), slightly exceeding market expectations, primarily driven by fuel prices.
Core inflation stood at 2.9%, with the domestic CPI at 4.3%, indicating persistent inflationary pressures.
Inflation also saw sporadic increases in Central Europe, with Belgium's August CPI at 3.97% and Austria's July PPI at 3.3%.
German Political Instability DeepensUncertainty
Chancellor Friedrich Merz's approval rating has fallen to 16%, a 30-year low, potentially shaking the conservative bloc's foundation in September regional elections.
The rise of the far-right AfD party adds political uncertainty to the government's planned €500 billion infrastructure investment.
Germany's weak economic recovery faces policy vacuum risks amid this political turmoil.
Switzerland KOF Economic Barometer+106.7
The leading indicator rose to 106.7 in August, surpassing forecasts of 103.3.
Swedish EconomyStrong Growth
Sweden's economy demonstrated robust growth in the second quarter.
Consumer sentiment also showed a notable improvement.
Ireland Retail Sales+1.3% MoM
Provisional July retail sales volumes increased 1.3% month-on-month.
Year-on-year, retail sales volumes rose by 2.2% in July.
German Bond YieldsWeekly Rise
German yields were set for a weekly increase, despite a fall in oil prices.
Market attention remained focused on Federal Reserve commentary.
German Political StabilityRecovery Threat
Germany's political instability poses a risk to its fragile economic recovery.
Concerns are growing that internal issues could hinder growth efforts.
Belgium CPI+3.97% YoY
August Consumer Price Index rose 0.40% month-on-month.
The annual inflation rate reached 3.97% in August.
Asia
Philippine Peso Hits Record Low62.22/USD
The Philippine Peso (PHP) fell to a new record low of 62.22 per dollar, despite the central bank's 25bp policy rate hike the previous day.
The effectiveness of monetary tightening in defending the currency is being undermined by high energy import costs and slowing capital inflows.
Analysts note limited additional intervention capacity due to insufficient foreign exchange reserves.
Australian Dollar Extends Winning Streak9-Week High
The Australian Dollar (AUD) climbed to a three-month high of 0.7204 against the USD, extending its winning streak to a ninth consecutive week.
This surge was fueled by an inflation surprise, which pushed the probability of a September RBA rate hike to 58.5%.
The AUD/USD broke through the key 72-cent resistance and is now challenging the May high of 0.7277.
Tokyo Core CPI Exceeds Expectations+1.8%
Tokyo's August core Consumer Price Index (CPI) rose 1.8% year-on-year, surpassing market expectations of 1.7% and the previous month's figure.
This suggests persistent inflationary pressure that could extend to national inflation figures in Japan.
New Zealand RBNZ Rate Hike Expected+25bp
The Reserve Bank of New Zealand (RBNZ) is widely expected to hike its cash rate by 25 basis points to 2.75% on September 2.
A Reuters poll showed 27 out of 31 economists (nearly 90%) support this hike, following the first increase in July.
Over two-thirds of experts anticipate at least one more RBNZ rate hike before year-end, potentially reaching 3% or higher.
India 10-Year Bond Yield6.91% (2M High)
India's 10-year bond yield reached 6.91%, a two-month high, widening the spread with the US 10-year yield (4.67%) to 224 basis points from 207bp in early August.
Expectations of tighter monetary policy from the Reserve Bank of India (RBI) and upcoming large government bond supply are driving the increase in Indian bond yields.
Amid global interest rate uncertainty, particularly ahead of the Federal Reserve Chair's Jackson Hole speech, there is potential for further increases in India's 10-year yield.
India GDP Growth ForecastFY27 +7.0%
Nomura raised its forecast for India's FY27 economic growth by 40 basis points to 7.0%.
The firm expects Q1 (April-June) growth to be 7.8% (Reuters consensus 7.1%), reflecting strong economic momentum in the first half.
Growth momentum is projected to moderate slightly from an average of 7.3% in H1 to 6.7% in H2, suggesting a slowdown over the year.
If Q1 growth surpasses expectations, the RBI may revise its annual growth outlook upwards at its October policy meeting.
India SEBI IPO RulesSmall Firms
India's Securities and Exchange Board (SEBI) is considering applying large-company IPO rules to smaller firms, standardizing costs and transaction requirements.
This includes increasing the institutional investor allocation to levels comparable to large-company listings, aiming to equalize key institutional elements for small-firm offerings.
The goal is to improve governance and enhance investor confidence by harmonizing rules for both large and small IPOs.
Taiwan Penghu IslandsDefense Boost
Taiwan is actively strengthening its military defenses on the Penghu Islands, preparing for a potential Chinese invasion.
Taiwan Bolsters Defenses Against Potential Chinese Strike
Taiwan's military is strengthening garrisons on strategic islands, considered first strike targets by the PLA.
Troops are checking and loading ammunition, including 105mm artillery shells, and conducting civilian civil defense drills.
China criticized these military enhancements as 'delusional,' highlighting deepening cross-strait tensions.
Markets & Commodities
Brent Crude Sees Weekly Decline-5%
Brent crude oil fell 5% this week, marking its first weekly decline in three weeks, closing at $89.2/barrel.
This drop is attributed to an agreement between Iran and Oman to manage traffic and share revenue in the Strait of Hormuz, reducing geopolitical risk premium.
Despite the Strait of Hormuz being effectively closed due to the Iran conflict, news of the US seeking long-term access to Venezuelan oil fields also eased supply concerns.
G20 Meeting Focuses on Growth and ImbalancesAgenda
The G20 Finance Ministers meeting, scheduled for August 31-September 1, will prioritize restarting economic growth and reducing global imbalances.
Discussions will also cover strengthening supply chain resilience and fostering private sector innovation.
The US plans to pressure companies to cut ties with Iran, adding to the agenda.
NVIDIA (NVDA) Leads Tech Rally+8.7%
NVIDIA (NVDA) surged 8.7%, leading the technology sector higher and easing investor concerns about the sustainability of AI demand.
Despite this, global equity markets remained cautious, constrained by anticipation of Fed signals and ongoing rate hike concerns.
Japan
Tokyo Inflation+1.8% Core CPI
Tokyo's core CPI (excluding fresh food and energy) accelerated to 1.8% year-on-year in August, exceeding forecasts of 1.7%.
The overall CPI rose 1.9% year-on-year, with the index excluding fresh food and energy at 2.0%, signaling broad price increases.
Widespread price pressures, influenced by global supply chain issues and Middle East conflicts, will be a key focus for the Bank of Japan's September policy meeting.
Japan Government Bond Yields5Y JGB 2.195%
The 5-year JGB yield hit a record high of 2.195%, up 4 basis points from the previous day.
The 2-year JGB yield also rose to 1.7% (+1.5bp), indicating a decline in bond prices.
Demand for 2-year JGB auctions significantly decreased compared to the previous month, reflecting weakening investor sentiment amid expectations of further rate hikes and inflationary pressures.
Japan Government Bond Issuance¥40T Cap
The Japanese government aims to cap new bond issuance at around 40 trillion yen for fiscal year 2027.
Prime Minister Takaichi stated this despite budget requests from ministries exceeding 130 trillion yen, a record for the fourth consecutive year, relying on increased tax revenues to curb new debt.
The policy intends to maintain the FY2025 issuance level through FY2027.
Toyota (7203) Sales-4.8% Global
Toyota's global sales in July fell 4.8% year-on-year to 856,125 units, while production decreased by 2.1%.
Sales in China dropped 24.3%, marking the sixth consecutive month of decline, as rising oil prices suppressed demand for hybrid and internal combustion engine vehicles.
Sales also declined in the United States (-0.8%) and the Middle East.
Japan Unemployment Rate2.4% in July
Japan's unemployment rate improved to 2.4% in July, outperforming market expectations of 2.5%, indicating robust underlying employment demand.
The job-to-applicant ratio remained at 1.18, unchanged from June, signaling persistent labor shortages.
Aging demographics are causing severe labor shortages in the service sector, with Prime Minister Takaichi's limited immigration policies exacerbating labor supply constraints.
Middle East
Gulf Infrastructure InvestmentDiversification
The near-blockade of the Strait of Hormuz is prompting Gulf nations to bolster investments in alternative energy export infrastructure.
The threat of an Iran war is reshaping global trade maps, highlighting the critical need for diversifying key energy transit routes.
UAE and Saudi Arabia are pursuing multi-billion dollar investments in bypass infrastructure, including pipelines, ports, and railways.
Iran's KhameneiUnseen for 6 Months
Iran's Supreme Leader Mojtaba Khamenei has not been seen publicly for six months, fueling concerns about a leadership vacuum during wartime.
Despite claims from senior officials that he retains decision-making authority, the complete absence of photos, videos, or audio has intensified doubts among the Iranian public regarding his health and role.
He was reportedly appointed after sustaining severe injuries in an airstrike.
Emerging Markets
Philippine Peso (PHP)Record Low 62.226
The Philippine Peso weakened to a record low of 62.226 per US dollar, extending its weekly decline for the third consecutive week.
This depreciation occurred despite the Bangko Sentral ng Pilipinas (BSP) raising its benchmark interest rate by 25 basis points to 5% yesterday, failing to curb currency weakness.
Ongoing concerns over energy costs and weak capital inflows continue to exert pressure, with the country's $2 billion foreign exchange reserves deemed insufficient for effective intervention.
Poland Fiscal Outlook2027 Deficit 7.1%
Poland projects its fiscal deficit to remain at 7.1% of GDP in 2027, with economic growth forecast at 3.0% and inflation at 2.8%.
Defense spending is allocated 19.8 billion zlotys, exceeding 4.5% of GDP, to support Ukraine and strengthen eastern defenses.
Total borrowing needs are expected to decrease to 56.5 billion zlotys from 60 billion zlotys in the previous year.
Russia Economic ForecastFY26 Growth +0.4%
Sberbank, Russia's largest financial institution, forecasts the central bank to cut its key interest rate to 13.5% by year-end and revised its 2026 growth forecast upwards to 0.4%.
The Q2 performance exceeded market expectations, driven by robust government and consumer demand, though the impact of attacks on Ukraine remains a variable.
Czech Republic Q2 GDP+1.9% YoY
The Czech Republic's Q2 GDP growth was confirmed at 1.9% year-on-year, primarily driven by increases in household consumption (+2.7%) and fixed capital formation (+7.1%).
Quarterly growth was confirmed at 0.4% (unchanged from preliminary estimates), while government spending saw slight increases (0.1% quarterly, 1.0% annually).
Greece Producer Prices+11.8% YoY
Greece's July producer price inflation surged 11.8% year-on-year, largely driven by a sharp 21.5% increase in energy prices.
On a monthly basis, producer prices rose 2.9%, contrasting sharply with a 3.0% decline in June.
China
Shanghai FTZ Bond MarketSubsidies Planned
Shanghai plans to introduce subsidies for bond issuance fees to revitalize its Free Trade Zone (FTZ) offshore debt market.
Government subsidies aim to reduce bond issuance costs for offshore issuers in the FTZ, lowering market entry barriers.
The People's Bank of China allows domestic banks to purchase FTZ bonds within limits, and clearing agencies are holding promotional events to boost market activity.
Despite opening 13 years ago and launching its offshore bond market in 2016, the FTZ has seen stagnant growth due to a lack of foreign participation.
China Finance MinistrySurtax Law Draft
China's Ministry of Finance has released a draft local surtax law for public consultation.
S&P China Credit RatingA+ Affirmed
S&P affirmed China's 'A+' credit rating, forecasting economic growth above 4% over the next 1-2 years.
The outlook remains stable, with the government's continued expansionary fiscal policy expected to support economic growth.
S&P noted progress in supply chain, technological capabilities, and manufacturing competitiveness, maintaining a positive assessment of resilience amid global uncertainties.
China Housing MarketPrices -3.4%
Chinese home prices are expected to fall 3.4% this year, a smaller decline than anticipated in a May Reuters poll, but are now projected to fall 0.3% in 2027, reversing a previous forecast of a 0.3% rise.
Property investment is expected to shrink by 20%, and sales area by 10%, indicating a deepening weakness in the sector with an uncertain stabilization timeline.
Tibet-Nepal Landslide LakeFlood Risk
China is urgently working to mitigate the risk of a landslide-dammed lake bursting near the Tibet-Nepal border.
A potential breach and overflow of the lake threaten further flooding in the border region, following hundreds of deaths since last Wednesday.
Both China and Nepal have issued warnings about new flood risks in the Himalayan region.
China Yuan (CNY)6.7211/USD
The Chinese Yuan remained near its strongest level in 3.5 years at 6.7211 per US dollar, as the People's Bank of China (PBOC) pursued a conservative policy stance, favoring low volatility.
Analysts anticipate little significant movement for the Yuan in the coming months, with markets focusing on the future direction of US monetary policy.
PBOC Reverse Repo¥20B Injected
The People's Bank of China (PBOC) injected 20 billion yuan via 7-day reverse repos, maintaining the interest rate at 1.40%.
Korea
Korean Won (KRW)Strongest since 2025
The Korean Won reached its strongest level against the US dollar since July 2025, trading at 1375.5 per dollar.
This strength was primarily supported by the Bank of Korea's (BOK) hawkish stance, with a high likelihood of an additional 0.25% interest rate hike this year.
The Won's relative strength was notable despite inflation warnings from senior Federal Reserve officials.
KOSPI Index-1.07%
The KOSPI index fell 1.07% to 6,838.22, marking its second consecutive weekly decline, as foreign investors continued net selling.
Momentum from positive NVIDIA AI outlooks faded, leading to increased profit-taking.
Investor sentiment became more cautious ahead of decisions from the Federal Reserve's Jackson Hole conference, contributing to rising bond yields.
South Korea ExportsAug +62.6% YoY
South Korea's exports are projected to increase by 62.6% year-on-year in August, extending a 15-month streak of positive growth, according to a Reuters poll of economists.
This momentum, similar to the 63% increase in July, is driven by robust global demand for AI chips.
Memory chip exports from Samsung Electronics and SK Hynix are leading this growth.
Latin America
Brazil's Lula Dismisses Public Debt Concerns
President Lula stated that public debt is not a concern for a potential new term, citing an improved fiscal scenario since his 2023 inauguration.
The government anticipates achieving a primary surplus this year, with economic growth expected to help reduce the public debt-to-GDP ratio.
Uncertainty Surrounds Brazil's Oil Export Tax
Brazil's 12% oil export tax is in limbo following a court order to suspend it, conflicting with the government's 60-day extension.
The clash between the judicial decision and the foreign trade agency's approval could lead to legal disputes between the Lula administration and oil producers.