Daily Overview: 18 September 2026

All eyes turn to the Bank of Japan this afternoon (13:00 AEST), where markets are pricing a near-certainty of a hike from 1% to 1.25%. A hawkish BoJ would add another layer of global tightening just as the Fed's Kevin Warsh spooks markets with talk of removing "a dose of accommodation" — the yen carry trade unwind is a risk commodity markets should not dismiss. Watch the AUD/JPY cross closely.

German PPI at 16:00 AEST is forecast to accelerate to 4.1% YoY from 3%, reinforcing the inflation stickiness narrative that has global bond yields at multi-year highs. US Industrial Production at 23:15 AEST is expected to tick up to 0.3% MoM — a miss here would be the first crack in the "AI-driven capex boom" story that's propping up equities and base metals.

Oil remains the elephant in the room. With Brent near $108 and the Houthis now targeting Saudi pipelines, the risk premium is building again. Any escalation headlines today will trump all other data. The Fed's hawkish pivot, combined with the RBA's expected hike on September 29, means the Australian dollar faces a double squeeze — expect continued pressure on the currency and any AUD-denominated commodity plays.

International

Economic Releases

• US housing data disappointed: housing starts fell 2.6% to 1.275M (vs 1.31M consensus) and building permits dropped 2.7%, signalling cooling in the US property sector that could weigh on construction-related commodity demand.
• US initial jobless claims came in at 196K, well below the 208K consensus — a tight labour market that supports the Fed's hawkish stance and keeps upward pressure on US rates.
• The Philadelphia Fed Manufacturing Index cooled to 37.8 from 47.4 but still beat the 30.5 consensus, suggesting US industry remains resilient despite rate hikes.
• The BoE held rates at 3.75% with a 6/9 split for unchanged — no surprises there, but the UK's steady-as-she-goes approach contrasts sharply with the Fed's tightening bias.

Macro & Policy

• The Federal Reserve raised rates by 25bp to 3.75%-4.00% in a unanimous decision, with new chair Kevin Warsh signalling further hikes — his comment about removing "a dose of accommodation" sent the S&P 500 lower and pushed the 10-year Treasury yield above 5% for the first time since 2007.
• The IMF urged Australian governments to cut spending to curb inflation and manage the $1.6 trillion debt pile, warning the RBA should maintain a bias toward further hikes and flagging transition costs from recent tax changes on capital gains and negative gearing.
• The government's migration overhaul — cutting net overseas migration from 292,000 to 225,000 by 2028 — drew fierce backlash from farming, tourism, and education sectors, with warnings of staff shortages exceeding 100,000 and risks to food security.
• Construction insolvencies hit a record 941 in August, more than double the previous monthly high, driven largely by the Bathla collapse (542 appointments) — expect more pain as rates rise.

Energy & Geopolitics

• Saudi Arabia intensified air strikes on Houthi positions in Yemen, with the rebels firing drones and missiles at Saudi oil infrastructure including a pipeline that could disrupt up to 4% of global supply — Brent is near $108 and US diesel prices are at record highs.
• BHP estimated static charging for battery-electric haul trucks could cost about 1,000 lost operating hours per year versus diesel, and will trial Caterpillar's Dynamic Energy Transfer system at Jimblebar in FY27 to charge trucks while moving.
• Investors slammed BHP and Rio Tinto for extending diesel truck lifespans and delaying emissions cuts, with the Investor Group on Climate Change questioning their net zero commitment while Fortescue argues electric trucks are viable and cost-saving.
• Aware Super, the SECV, and Birdwood Energy partnered on the $700 million Baranduda battery near Wodonga — Victoria's longest-duration battery at 400MW/1.86GWh — to firm renewables after Yallourn closes in 2028.

Mining & Commodities

• Global Lithium slashed Manna project pre-production capital by 59% to $180.1 million by converting IGO's Nova processing plant instead of building new — post-tax NPV jumped to $945.7 million and payback fell to about 11 months, with first concentrate targeted for mid-2027.
• Encounter Resources reported its best niobium intersection yet at Green in WA's West Arunta — 51m at 5.0% Nb2O5 including 13m at 10.4% — outside the existing resource boundary, strengthening the case for high-grade starter pits.
• Queensland introduced its mining objections reform bill, restricting who can object to a mine and giving politicians greater control over court referrals — AMEC welcomed the efficiency push while opponents warn it undermines independent scrutiny.
• WA's resources sector holds an $8.1 trillion opportunity across 27 commodities, according to CME analysis, with iron ore accounting for 48.8 billion tonnes of known remaining resources versus 17 billion tonnes extracted over 125 years.
• Stockbrokers Ord Minnett, Argonaut, and Euroz Hartleys posted bumper profits on the mining M&A and capital raising frenzy, with Argonaut more than doubling dividends to $20.9 million.
• PC Gold identified a high-grade gold target at Spring Hill's Southern Adit with a standout composite of 20.35m at 13.04 g/t gold, including samples up to 74.8 g/t — drilling starts late September.