What moved this week and what it means for expats in SE Asia

Last week this page reported that Iran and Oman had announced a framework to restore navigation through the Strait of Hormuz, and said in the same breath that an announced corridor is not an open one. The corridor never opened. American forces struck Iranian rocket launchers inside the strait early in the week. Iran answered on 3 September with missiles and drones aimed at the Ahmed al-Jaber air base in Kuwait and the Al Minhad air base in the United Arab Emirates, a second consecutive night of retaliation, and Kuwait confirmed its air defences engaged. Two Filipino crew were killed aboard the tanker Sidr on 31 August, the first commercial shipping deaths since the exchange resumed. Six commodity vessels crossed the strait on the Wednesday, down from eleven on the Tuesday, against a ten-day average of nearly thirteen. Iran has said it will keep attacking commercial shipping while American strikes continue.

Brent rose 7.4% on the week to settle at $96.71, its strongest week since July, taking back everything the corridor announcement had removed and more. For anyone in Malaysia, Singapore or Thailand, the practical read is unchanged from six weeks ago. Regional freight, fuel and insurance costs stay exposed to a waterway that is still being fought over. Any planning that assumed a resolution this quarter should now drop the assumption.

The American rate story moved in the opposite direction and just as sharply. August payrolls came in at 162,000 against a consensus near 53,000. That reverses the July figure of minus 23,000, which was the print that had turned the whole narrative dovish a month earlier. Midweek, the odds of a September rate rise had fallen to around 50% after Governor Christopher Waller said he would favour holding if inflation kept easing. The payrolls figure arrived on the Friday and pushed them back up. Different sources now put a September rise between 57% and 70%. The spread is wide, and it is worth quoting as a range. The decision lands on 16 September, and August inflation is published before it. That is three separate moves in one question inside seven days.

Sterling's week depended entirely on which country you live in, and the answer inverted from last week. It fell 0.74% against the Singapore dollar and 0.49% against the baht, which were its two worst crosses. Against the ringgit it was effectively unchanged at 0.07%. Seven days earlier the baht had been the only currency sterling gained on. A sterling-funded professional in Singapore had a poor week. The same person in Kuala Lumpur had no week at all, and neither will have seen a headline naming their cross. That is the second fortnight running in which one currency produced opposite outcomes depending on the country.

British long-dated debt rose with American yields rather than with oil, which breaks a four-week pattern. The ten-year gilt yield reached 5.07%, touching a fourteen-month high during the week on the American jobs print, while the thirty-year Treasury rose to 5.27%. Bank Rate stays at 3.75%. For anyone weighing a defined benefit transfer, higher gilt yields still mean lower transfer values. On the Budget, the calendar has tightened: formal representations to the Treasury close at 23:59 on 9 September, which is two days away, while the Budget itself is 51 days away on 28 October. The consultation on raising the normal minimum pension age to 57 closes on 28 September. Press speculation about the tax-free lump sum, currently capped at £268,275, has also restarted. Nothing has been published or proposed, and it should be treated as speculation until it is.

American equities absorbed a Gulf escalation and a jobs shock and finished the week almost exactly where they started. The S&P 500 rose 0.09% to 7,718.60, the Nasdaq 0.40% to 26,506.99, the Dow fell 0.27% to 53,414.25, and the Russell 2000 rose 0.08% to 2,974.85, having led the large-cap indices on the Friday after two losing weeks. The volatility index closed at 14.53. Asia split for a third consecutive week, this time with Japan's Nikkei down 2.09% and Hong Kong's Hang Seng up 0.26%. Gold broke a four-week run of gains and fell, with Friday prints ranging from roughly $4,380 to $4,430 against $4,608 a week earlier, because the dollar firmed on the payrolls figure.

The clearest lesson of the week is in what did not happen. A Gulf war restarted, oil rose 7.4%, and American payrolls came in three times the forecast. Four American equity indices finished the week within half a per cent of where they began. Anyone who followed the news that week and then opened their statement would assume the statement was wrong. It was not. A diversified equity holding is built to absorb exactly this. The absorption is impossible to demonstrate in advance, which is why it is worth showing afterwards using the week's own numbers.

The rate call makes the same argument. It has now moved three times in seven days: down to roughly even odds on one Fed governor's remarks, then back up to somewhere between 57% and 70% on one payrolls print, having reversed entirely on a speech the week before that. Anyone who repositioned a portfolio on each of those readings has traded three times in a week, paid for it three times, and ended where they started. A structure that does not require the forecast is the only version of this that survives a month like the last one.

Gold has now done the same thing often enough to count as a pattern. This week a Gulf war restarted, oil rose 7.4%, and gold fell. In July it ignored a live war. In August it ignored a hawkish new Fed chairman, then ignored a de-escalating Gulf. It moved this week because the dollar firmed on a payrolls figure, which is what it has been pricing all along. If gold is held because of one specific fear, eight months of evidence say it does not price that fear. Held as structural ballast, sized to do an ordinary job across a range of outcomes, it earns its place. A globally diversified core built through Irish-domiciled accumulating UCITS funds required no view this week on the strait, on payrolls, or on which way Asia would split.