What moved this week and what it means for expats in SE Asia
Markets, currencies, and macro events filtered through one lens: what does it mean for a European professional living in Malaysia, Singapore, or Thailand with assets spread across multiple jurisdictions?
Oil broke $100 for the first time in this conflict and pulled the Fed straight back toward a rate rise, eight days after a cold inflation print was read as ruling one out
Eight days is how long a market conviction lasted this week. Last Friday the read was settled: a cold June inflation print had taken a July rate rise off the table, and the Federal Reserve and the Bank of England were heading in opposite directions. By this Friday half of that had inverted. Brent crude closed at $100.69 on Thursday, having touched $102 during the session, its first triple-digit close of this conflict and the highest in eight weeks. The trigger was a thirteenth consecutive day of US strikes and Houthi attacks on two Saudi tankers in the Red Sea. It gave some of that back on Friday to finish at $96.80, up 9.9% on the week.
That was enough on its own. Futures markets moved from roughly 87% confidence in a hold on 18 July to a 65/35 split by Friday, and the odds of a rise by September now sit at 82%. Nothing in the American economy changed over those eight days. Only the oil price did. The Fed decides on Wednesday 29 July, with Chair Kevin Warsh speaking afterwards. The lesson worth keeping concerns the reading itself. A single inflation figure, measuring a month that had already ended, was treated as a structural turn and survived barely a week. The July figure, published in mid-August, is the first one that will contain $100 crude.
Then it partly unwound. Late in the week China initiated and Pakistan began brokering a push to restart talks between Washington and Tehran, with Iran's interior minister visiting Islamabad twice inside ten days. Brent fell about 4% on Friday and to roughly $91 by Sunday. President Trump confirmed negotiations are running but offered no guarantee. Treat this as a live two-way risk. Anyone reading the oil price on Monday morning is reading one side of an argument that is still being had.
Britain repriced hardest, and the way it did should trouble anyone with UK exposure. The 10-year gilt yield reached 5.05%, touching 5.07% intraday, the highest since July 2008. Markets now price two Bank of England rises by March 2027, though the Bank is expected to hold at 3.75% on Thursday 30 July. Yet sterling fell against everything: down 0.85% against the dollar, 0.95% against the ringgit, 0.86% against the Singapore dollar. Rising rate expectations normally support a currency. When they fail to, the market has moved past policy to the fiscal position behind it, and that is the clearest verdict yet on Andy Burnham's first fortnight in office. For anyone holding a defined benefit transfer decision, a gilt yield at 5.05% means transfer values keep falling, and the direction of travel has not changed.
Equities ground lower without breaking. The S&P 500 finished at 7,412, down 0.61% on the week, and the Nasdaq fell 2.13% to 24,976 on continued doubts about AI capital spending. The volatility index barely moved, closing at 18.58. Asia went the other way for a second week: Hang Seng up 1.63%, Nikkei up 0.73% despite a sharp Friday fall. Gold, offered a war, a $100 oil price and a Red Sea escalation, managed 0.84% and closed near $4,052. Bank Negara held its policy rate at 2.75%, and the ringgit was the steady leg through all of it, essentially unchanged against the dollar.
Currency rates relevant to European expats in SE Asia
As at Friday 24 July close. Rates are indicative. Source: European Central Bank reference rates.
Currency context for this week
Sterling had a poor week everywhere it matters here. GBP/MYR fell to 5.45 from 5.50, GBP/SGD to 1.72 from 1.74, and GBP/THB to 44.89 from 45.20. Those are moves of roughly 0.7% to 1.2%, small in isolation but all pointing the same way, and they came in a week when British interest rate expectations were rising. That combination matters. A currency that falls while its rate outlook improves is telling you the market is worried about something else, in this case the fiscal position behind a 5.05% gilt yield.
The euro held up better, easing 0.51% against the dollar and 0.61% against the ringgit to 4.65. For a European expat paid in euros, this was close to a non-event. For anyone converting sterling into ringgit, baht or Singapore dollars, a pound bought roughly 1% less than it did a week ago. On a monthly transfer that is noise and no reason to change a standing schedule. On a large one-off conversion, a school fee instalment or a property deposit, it is worth a conversation about timing. The ringgit deserves a mention of its own: it was flat against the dollar through a week when oil touched $100, which for a net energy exporter with contained inflation is a strong result.
What this week's moves mean for your portfolio
This week made an argument that is hard to make in a calm one. Oil broke $100, a second shipping route came under attack, and the Federal Reserve's expected path reversed inside eight days. Against all of that, a globally diversified equity core lost 0.61% and Asian markets rose. The portfolio that struggled was the concentrated one: the Nasdaq fell 2.13% on AI spending doubts that have now run for four weeks. A broad Irish-domiciled accumulating UCITS core makes no forecast at all. That is the whole design: it held no view on the Gulf, the peace talks or the AI trade, so it needed to be right about none of them.
Gold has now failed the same test three weeks running. Offered a $100 oil price, a thirteenth day of strikes and an attack on Saudi tankers, it returned 0.84% and remains about 28% below its January high. Anyone holding gold as insurance against a Middle East escalation has had that thesis tested directly and found it wanting. Gold still belongs in the portfolio, sized as ballast that works across a range of outcomes. Held that way it does not need to justify itself weekly.
The rates picture is where structure earns its keep. American policy could move either way at Wednesday's meeting, Britain is expected to hold while pricing two rises by March 2027, and both paths are hostage to a barrel of oil that moved from $88 to $100.69 to $91 in five trading days. None of this is investable on a ten-year horizon. What holds up regardless of Wednesday's outcome is a global equity core, a modest gold allocation doing an unglamorous job, and enough short-duration income that a central bank decision stays something you read about. If you hold a UK defined benefit transfer decision, the 5.05% gilt yield is the one number this week that genuinely changes your maths, and it is worth revisiting properly.
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