July Foreign Trade Indices Declined and Global Markets Are Shaken by Geopolitical Risks
Alongside the observed slowdown in foreign trade volume, rising oil prices and Fed expectations in global markets are shaping the economy.
While Turkey experienced a contraction in its July foreign trade volume indices, geopolitical risks, rising oil prices, and expectations of a Fed rate hike came to the forefront in global markets.
Slowdown in Foreign Trade Data
Foreign trade data announced for July in Turkey showed a decline in export and import quantities. The export volume index receded by 4.9 percent on an annual basis, while the import volume index decreased by 6.9 percent. Following the strong increases in June, these data recorded a noticeable slowdown in trade volume.
Geopolitical Risks in Energy Markets
Global markets started the new week marked by geopolitical risks and increases in oil prices. Saudi Arabia keeping the East-West oil pipeline closed and developments regarding Iran escalated concerns in energy markets. Protocol violations in the Strait of Hormuz further heightened tensions in the region.
Fed Expectations and Bond Yields
The possibility of the increase in oil prices accelerating global inflation brought central banks' actions to the forefront. While bond yields reached their highest levels in years, expectations that the Fed will proceed with a rate hike gained strength. With the rise of the Dollar Index, global risk appetite weakened.
Latest Status in Gold and Exchange Rates
The strengthening dollar, rising bond yields, and Fed expectations pressured spot gold, carrying prices to their lowest levels in five weeks. Against the Turkish lira, the dollar, euro, and sterling continue to maintain their courses at high levels.