Finance

Crude oil benchmarks fell as reports emerged that American and Iranian officials are negotiating a phased agreement to reopen the strategic Strait of Hormuz. Brent crude dropped below $98 a barrel, while West Texas Intermediate neared $92 a barrel. Despite this relief, fuel costs remain a heavy focal point for macro inflation concerns after months of geopolitical friction.

The bond market selloff took a brief breather, allowing the benchmark 10-year Treasury yield to settle around 5.18% after previously pushing toward 5.22%. However, sovereign debt yields remain locked near their highest levels since 2007. Persistent strength in domestic economic indicators continues to keep the possibility of a Federal Reserve interest rate hike highly likely for the upcoming month.

The University of Michigan's consumer sentiment index registered at 48.1 for September, reflecting a decline from August's reading of 51.7. Escalating energy costs have weighed heavily on public perception, driving consumer expectations for near-term inflation up to 4.6%. These rising expectations present an ongoing challenge for central bank policy, as they can inadvertently trigger broader cost-of-living increases.