Global financial markets, already strained by a bond selloff and sharp currency swings, face the risk of more volatility in the months ahead due to potential interest-rate hikes, fiscal deficit concerns, and the ongoing war in the Middle East. As US investors return from the Labor Day holiday, ending the summer lull, bond and currency investors face a packed calendar including possible Federal Reserve hikes and more increases by the European Central Bank and Bank of Japan. The BOJ begins its two-day meeting with officials leaning toward a quarter-point hike this month, while the French-German bond spread is near its widest since the euro-area debt crisis. Running through it all is Trump and oil, so volatility is probably the only certainty, said Charlie Jamieson of Jamieson Coote Bonds. US President Donald Trump faces a key test in November's midterms, and geopolitical tensions, including US-Iran hostilities and trade disputes with Canada and China, add to the uncertainty.
