The United States applied to seize an Iranian tanker in Gibraltar,halting its expected release at the last minute and preventing a possible swap for British-flagged tanker held by Iran. The Grace 1 oil tanker was seized by Royal Marine commandos in a landing in darkness off the coast of the British overseas territory on July 4. Gibraltar said the tanker was suspected of selling oil to Syria in breach of European Union sanctions. Gibraltar was widely expected to release the Grace 1, but just hours before, the U.S. Department of Justice sought to seize it.
World shares held at 2-1/2-month lows and Wall Street was set for a firmer open as investors bet the U.S. Federal Reserve and other central banks would respond strongly to recession warnings emanating from bond markets.
It takes a lot to kill an economic expansion, typically requiring a major shock to bring growth to a halt and trigger a U.S. recession. This week investors signaled that moment may have arrived, and one big question is whether that shock has come from Trump’s trade war or a mistake by policymakers at the U.S. Federal Reserve.
A U.S. recession warning from financial markets has Donald Trump’s fingerprints all over it. A key bond market metric turned negative for the first time since 2007 on Wednesday, sending stocks tumbling. Other economic indicators in the U.S. and abroad are deteriorating. The common thread linking these is the president’s trade war, writes Tom Buerkle.
