Markets Cheer, Central Banks Warn: Inflation Risk Persists

Markets Cheer, Central Banks Warn

Global markets are hitting record highs driven by AI optimism, but central bankers caution that inflationary damage from the Middle East crisis may persist. Stock markets in Japan and South Korea surged to new records.

Oil Prices and Peace Hopes

Markets are buoyed by hopes of a US-Iran peace deal to reopen the Strait of Hormuz. However, US strikes on Iran have violated a ceasefire, keeping oil near $100 a barrel.

Central Banks Signal Tightening

BOJ Governor Ueda warned that energy shocks can have persistent effects. ECB's Schnabel said a June rate hike is warranted even with a peace deal. The Reserve Bank of New Zealand avoided a surprise hike but signaled more increases ahead.

Tech Sector and Investments

Samsung Electronics averted a strike, and Nvidia's Jensen Huang announced $150 billion annual investment in Taiwan.