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Overseas news
The US has officially lifted its naval blockade of Iran after 2 months. This allowed commercial ships and oil tankers to again pass through the Strait of Hormuz.
Oil prices continued their decline following the end of the blockade. While the reopening provides immediate relief, analysts expect traffic to reach only 50% of pre-war capacity within 30 days of the US-Iran deal.
The Strait of Hormuz is a key waterway for oil transit that became a chokepoint amid US-Iran tensions, triggering price increases felt worldwide.
Meanwhile, US stocks rose, fueled by a surge in semiconductor and technology stocks. Semiconductor shares led the rally after President Donald Trump announced Intel and Apple will partner on designing chips in the US.
Local developments
The Bangko Sentral ng Pilipinas (BSP) raised its policy rate by 0.25% to reach 4.75% during its June meeting. The decision is aimed at addressing the elevated inflation driven by the Middle East conflict.
Central banks like the BSP raise key rates to manage inflation since higher interest rates make borrowing more expensive and can slow down economic activity.
Meanwhile, the Philippine Stock Exchange index (PSEi) rebounded as concerns over the global oil supply eased.
Additionally, the peso depreciated to P60.567 per US dollar. This happened amid hawkish statements from the US Federal Reserve (the Fed).
In finance, a “hawkish” monetary policy pushes for high interest rates to fight inflation. Higher interest rates tend to strengthen a currency.
Today’s news shows mostly positive signals, though there is little indication of big changes happening right away. Maintaining your investing strategy may be a good move for now.
