The RBA Raised Its Policy Rate To 4.6%

The US equity markets ended Monday’s session with a sharp decline amid renewed escalation in the US-Iran conflict and heavy selling in the bond market. By the end of the day, the Dow Jones (US30) fell 0.67%, the S&P 500 (US500) dropped 0.77%, and the Nasdaq (US100) closed in negative territory at 1.08%. A spike in oil prices – triggered by President Trump’s rejection of Iran’s proposals regarding the Strait of Hormuz – intensified inflation fears and pushed the yield on 10‑year US Treasuries to a 19‑year high. Investors remain focused on the upcoming releases of the core PCE Inflation Index and the US employment report, which will provide new guidance on the likelihood of further Federal Reserve tightening.

High interest rates and tight financial conditions exerted significant pressure on the technology and semiconductor sectors, which are forced to rely on debt financing at record‑high costs. Intel shares fell ‑5.7%, Meta lost 4.8%, and AMD, Micron, Amazon, and Microsoft declined between 1.3% and 3.6%. The main exception to the negative trend was Nvidia, which gained 1.7% after announcing a massive expansion of its share‑buyback program to a record $150 billion.

In Europe, Germany’s DAX (DE40) slipped 0.13%, France’s CAC 40 (FR40) edged up 0.01%, Spain’s IBEX 35 (ES35) fell down by 0.51%, and the UK’s FTSE 100 (UK100) closed 0.10% lower. European natural‑gas prices fell below €72/MWh, fully reversing the previous session’s upward impulse. The decline was driven by reports of gradually resumed LNG tanker movement through the Strait of Hormuz, where vessels linked to QatarEnergy were observed outside the main shipping lane. The fundamental backdrop in Europe remains tense ahead of the heating season: EU gas‑storage levels stand near 71%, well below the five‑year seasonal high of 87%, with Germany’s storage falling to a concerning 57%.

Oil prices retreated to around $93 per barrel, correcting part of the previous rally after briefly rising above $96. The main factor behind the pullback was the partial restoration of Saudi Arabia’s logistics infrastructure: Riyadh resumed flows through the strategic East-West pipeline at 3.5 million barrels per day following repairs. The pipeline had been temporarily shut down due to damage from Iranian drone attacks. Meanwhile, markets remain highly volatile amid conflicting geopolitical signals surrounding Iran and the broader Middle East.

In Asia, Japan’s Nikkei 225 (JP225) fell 0.73%, China’s FTSE China 50 dropped 2.09%, Hong Kong’s Hang Seng (HK50) rose 0.54%, and Australia’s ASX 200 (AU200) closed 0.17% higher.

The Reserve Bank of Australia (RBA) unanimously raised its policy rate by 25 basis points to 4.60% at its September 2026 meeting, in line with market expectations. This marks the fourth rate hike of the year and brings borrowing costs to their highest level since 2011. The regulator cited renewed inflationary pressure driven by surging global energy prices amid Middle Eastern supply disruptions, as well as persistent business‑cost growth fueled in part by strong global demand for AI‑related technologies.

S&P 500 (US500) 7,683.69 -59.72 (-0.77%)

Dow Jones (US30) 51,481.51 -347.11 (-0.67%)

DAX (DE40) 25,374.42 -34.22 (-0.13%)

FTSE 100 (UK100) 10,684.88 -10.37 (-0.10%)

USD Index 101.20 +0.23 (+0.23%)

News feed for: 2026.09.29

• Australia Cash Rate at 07:30 (GMT+3) – AUD (HIGH)

• Australia RBA Rate Statement at 07:30 (GMT+3) – AUD (HIGH)

• Australia RBA Press Conference at 08:30 (GMT+3) – AUD (MED)

• Switzerland KOF Economic Barometer (m/m) at 10:00 (GMT+3) – CHF (LOW)

• Eurozone ECB President Lagarde Speaks at 14:00 (GMT+3) – EUR (LOW)

• Canada GDP (m/m) at 15:30 (GMT+3) – CAD (MED)

• US JOLTs Job Openings (m/m) at 17:00 (GMT+3) – USD (MED)

• US CB Consumer Confidence (m/m) at 17:00 (GMT+3) – USD (MED)