Key Takeaways
- Bitcoin (BTC) surged above $80,000 for the first time since May, driven by a "debasement trade" narrative following U.S. Treasury buyback announcements and a massive $2.7 billion short squeeze.
- Japan's core-core CPI (excluding special factors) rose 2.2% in July, up from 2.0% in June, signaling persistent underlying price pressures that may influence future Bank of Japan (BOJ) policy.
- The UK government announced a £39 billion plan to deliver 70,000 social and affordable homes across England over the next decade, marking a significant shift in national housing strategy.
- Taiwan’s TAIEX index reversed early losses to gain 0.5%, finishing above the 45,000-point mark as buying interest returned to heavyweight semiconductor and shipping stocks.
- Fitch Ratings projects moderate growth in the UAE debt market for 2H26 and 2027, with government debt expected to rise while banks and corporates issue debt on an opportunistic basis.
Digital Assets and Currencies
Bitcoin (BTC) hit a more than three-month high on Tuesday, climbing nearly 3% in early Asian trading to reach $81,238. The rally has been fueled by a resurgence of the "debasement trade," with investors seeking a hedge against a weakening U.S. dollar following Treasury Secretary Scott Bessent's plan to expand bond buybacks. Analysts also noted that a $2.7 billion short squeeze—the largest liquidation event since 2021—forced traders to buy back positions, accelerating the upward momentum.
Asian Market Developments
Taiwan’s benchmark TAIEX index staged a recovery on Tuesday, reversing an intraday loss to close up 0.65% at 45,224.29. Heavyweight chipmaker TSMC (TSM) rose 1.47%, while shipping stocks saw strong gains supported by rising freight rates and geopolitical tensions in the Middle East. Meanwhile, in the Philippines, retailers are reportedly "tweaking recipes" and staggering price increases to cater to consumers squeezed by high inflation and a weak peso, which has become Asia's third-worst-performing currency this year.
Macroeconomic Indicators
Japan's economic data for July showed a mixed but firming inflation profile. While the Core CPI (excluding special factors) slowed to 2.3% from 2.6% in June, the Core-Core CPI—which strips out more volatile elements—ticked up to 2.2%. This suggests that underlying inflation is becoming more entrenched, potentially clearing the path for the Bank of Japan to consider further interest rate adjustments later this year.
Corporate and Industrial News
HSBC (HSBC) lowered its price target for Honeywell Technologies (HON) to $288 from $299.79, reflecting a more cautious outlook on industrial growth. In Australia, the industrial dispute at BHP Group (BHP) operations continues; port workers have submitted a counter-proposal regarding a new wage deal. Both parties are scheduled to meet again on September 8 to attempt to resolve the standoff at Port Hedland, the world’s largest iron ore export hub.
Sovereign Debt and Infrastructure
Fitch Ratings expects the UAE debt capital market to expand moderately, potentially surpassing $350 billion in 2026. The growth is expected to be supported by a strong presence in the Sukuk (Islamic bond) market and government funding diversification plans. In Europe, the UK government's £39 billion housing plan aims to build 70,000 homes in its first phase, with 60% of these designated for social rent to address the country's long-standing housing shortage.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.