Geopolitical events
On August 10, 2026, the U.S. Federal Reserve implemented an emergency 75--basis--point interest rate hike, raising the benchmark rate to its highest level in over 20 years. This decisive monetary intervention aims to curb the "war--driven inflationary spiral" resulting from the five--month blockade of the Strait of Hormuz and the subsequent 80% increase in global energy costs. Federal Reserve Chair Jerome Powell stated that the central bank will prioritize "price stability over short--term growth" to prevent a total collapse of the dollar's purchasing power. Market analysts suggest this move significantly increases the probability of a technical recession in the fourth quarter.