AGP Executive Report

Markets & Rates: Wall Street was mixed ahead of the Fed as oil jumped more than 4% after Jordan and the U.S. intercepted another Iranian missile barrage; in the UK, the Bank of England flagged higher mortgage costs as the effective rate on new loans rose to 4.35% in June, with fixed deals around 5.6%. AI Credit Risk: Reuters reports AI-linked credit default swaps are rising as investors question when heavy AI debt will pay off, pushing up the cost of insuring corporate bonds. Middle East Stability Watch: A Central Bank of The Bahamas stability report says geopolitical risks in the Middle East are dampening the global outlook, though domestic buffers remain strong. Lebanon-Israel Security Test: A feature says the real test of the U.S.-backed Lebanon-Israel framework is on the ground in southern Lebanon as Hezbollah disarmament and gradual Lebanese army takeover are put to the test. Iraq Militias & Regional Fallout: A pro-Iran Iraqi militia warned of a “heavy price” after U.S.-Saudi strikes hit PMF targets across Iraq. Saudi FinTech/Islamic Finance: Syarah, a Saudi digital automotive financing platform, secured Sharia certification for its financing and vehicle sales offerings. Digital Commerce Expansion: Lalamove launched in Riyadh with Arabic app support and cash-friendly delivery options for SMEs. Energy/Trade Signals: Egypt and the Philippines agreed to fast-track market access for five Egyptian agricultural exports.

Cross-border Payments & Sanctions Risk: China is accelerating yuan alternatives to SWIFT via mBridge and panda bonds, with central-bank partners including Saudi Arabia and the UAE, aiming to reduce geopolitical payment exposure. Energy Markets & Financing: Oil slid again as US-Iran hostilities eased and Oman talks to reopen the Strait of Hormuz gained traction; Commerzbank also cut gold and silver forecasts citing Iran-war uncertainty. Iraq-Türkiye Trade Corridor: Iraq and Türkiye doubled down on the Development Road, security and energy ties, including a Kirkuk pipeline/exports push toward 1m bpd and transport deal sign-off after a delay. Gulf Corporate Finance: Saudi Energy secured a SAR 15.8bn shariah-compliant Murabaha facility from major Saudi banks. Banking/Regulation Watch: Barclays warned against a UK windfall tax on banks after strong profits, arguing extra levies could curb lending. West Bank Risk to Finance: UN and regional officials condemned escalating settler violence and calls to disarm settlers, while relief operations face closures—raising operational and risk costs for businesses. Fraud & Compliance: An Iraqi court upheld a major real-estate swindle sentence (KD3m fine), underscoring enforcement pressure on investment scams.

Middle East energy logistics: Syria has become a key overland conduit for Iraqi fuel exports to Europe, moving 2.1 million tonnes since April via road to Baniyas for onward shipping—an alternative route as Hormuz disruption reshapes trade flows. Iraq–Türkiye economic push: Iraqi PM Ali Al-Zaidi heads to Ankara to advance a “historic” corridor plan linking Gulf, Asia and Europe, alongside security, water cooperation and investment talks. Dubai wealth and finance growth: DIFC says active registered companies hit 10,018 in H1 2026 (+2,318 new), with regulated firms and wealth managers expanding—reinforcing Dubai’s pull for global capital. Private markets funding: Brookfield raises $2bn for a PIF-anchored Middle East-focused private equity fund, while Monroe Capital backs Powder Alloy Corporation with a senior credit facility. Banking and rates watch: S&P Global flags Pakistan’s central bank likely to stay cautious as Middle East risks and inflation pressures persist; gold in Dubai slips on de-escalation hopes and rate outlook. Payments/fintech adjacent: Julius Baer (Middle East) partners with Dubai DET to attract global wealth and family offices. Market backdrop: Bitcoin holds near $63k as investors weigh Fed expectations amid Iran-war volatility and oil price swings.

West Bank Banking Shock: Israeli banks Hapoalim and Discount are reportedly set to suspend Palestinian correspondent banking ties, with the move due between Aug 13 and Sep 1—raising fears of a West Bank economic squeeze. UN & Humanitarian Pressure: UN chief Guterres condemned Israel’s accelerated legalisation of West Bank outposts as a “flagrant violation,” while Physicians for Human Rights warned Nablus closures are blocking ambulances and delaying emergency care. Settler Violence Escalation: Reports say mosques are being targeted again, with 7 burned and dozens desecrated since January, alongside wider raids, detentions and property destruction after the Tell incident. Iran-US De-escalation Hits Markets: Trump’s pause on strikes and Iran’s signals to halt retaliation eased oil and risk sentiment; Brent slid below $90 and European tech dragged as investors awaited major US tech earnings. Crypto & Risk Assets: The pause lifted risk appetite, with bitcoin stabilising after a spike and crypto sentiment improving as oil fell. Middle East Energy Routes: Lebanon floated a Mediterranean transit corridor for Iraqi crude to reduce reliance on Hormuz, while gas prices in Europe plunged as shipping bottleneck fears eased. Saudi-Uzbek Health Deal: Saudi and Uzbekistan discussed expanding healthcare cooperation and a major Fergana hospital project with Saudi investment. Egypt Football Finance: Al Ahly signed a major Vodafone-backed stadium investment deal with a FX-protection mechanism.

Middle East de-escalation and markets: US and Iran paused strikes for a third night, easing oil prices sharply (Brent back below $90) and lifting risk assets; investors also watched Fed expectations as the “pause” looks more like diplomacy space than a full ceasefire. Crypto rebound: Bitcoin reclaimed $65K as the strike halt reduced supply and inflation fears, with Ether also rising. Oman digital housing finance: Oman Housing Bank launched a digital waiting list platform for housing loans, letting applicants register online and track progress without early branch visits. UAE payments regulation: Yella Financial Solutions received initial Central Bank of the UAE approval for Class II retail payment services, a step toward expanding stored-value and retail payment capabilities. IAM funding in fintech: Capitolis appointed Ashwath Bhat as CFO, while Insight Partners and Glilot Capital co-led a $20M investment in Way Security to automate identity and access management operations. Regional infrastructure angle: Turkey and Italy renewed focus on Libya’s future amid migration and energy priorities, with implications for regional trade routes.

West Bank Crackdown: Israel launched a large-scale arrest campaign across the occupied West Bank after a deadly shootout near Nablus, with reports of dozens detained and settler attacks that included mosques set on fire—raising fresh risk for regional stability and any finance-linked cross-border activity. UN Sanctions Push for Syria: UN chief António Guterres urged the immediate removal of all remaining sanctions on Syria and called for investment to restart reconstruction, a key signal for future banking and capital flows. Iran-US De-escalation Signals: The US paused Iran strikes for a second night as Iran and Omani officials met, while both sides left diplomacy open—yet Strait of Hormuz disruption fears still hang over energy and risk assets. Oil & Rates Spillover: Oil volatility tied to Middle East tensions kept inflation and rate-hike worries alive in markets, with economists warning higher oil could pressure UK rates and broader investor sentiment. Qatar Banking Expansion: QNB Group opened a new QNB First premium branch in Msheireb Downtown Doha, leaning into digitally seamless private banking and wealth services. Crypto & Sanctions Reality Check: Iran’s oil ministry reported strong oil revenues despite sanctions, with digital payments cited as quietly supporting the payment pipeline. Middle East Competitiveness: GCC states highlighted strong performance in IMD’s 2026 competitiveness rankings, reinforcing the region’s push to attract investment through better business conditions.

Iraq Energy & Trade: Iraq’s cabinet approved steps to revive oil export routes, including a memorandum with Syria to build a pipeline linking Iraqi production to Mediterranean markets, aiming to cut reliance on Gulf and Turkey routes. Iraq Finance & Oversight: Iraq’s anti-corruption judiciary seized IQD 27bn in cash in the Adnan Al-Jumaili case, tracing proceeds tied to alleged project waste and irregularities. Iraq Infrastructure: Iraq says it has completed 100% preliminary designs for its Development Road Project and railway corridor, moving toward detailed engineering. Lebanon-Iraq Cooperation: Lebanese PM Nawaf Salam arrived in Baghdad with ministers to push bilateral cooperation, including finance, energy and telecom. Banking & Payments Tech: KB Kookmin Bank will launch an August 2026 corporate cross-border USD remittance service using JPMorgan’s Kinexys blockchain, covering payments to Saudi Arabia, UAE, Qatar and more. Crypto Markets: Bitcoin ETFs saw $225m outflows as Middle East tensions rattled crypto sentiment. Macro Rates Watch (UK): The Bank of England is expected to hold rates at 3.75% despite renewed Middle East uncertainty. Regional Business: Dubai launched a Kenya Business Council to boost trade and investment ties after the Kenya-UAE CEPA. Women & Innovation: Cairo hosted the Arab Women’s Entrepreneurship Forum with 450+ participants from 12 Arab and African countries, backed by the Innovest competition. Geopolitics & Risk: The US paused strikes on Iran for a second night as talks continue, while analysts warn munitions stockpile concerns could shape next moves. West Bank Flashpoint: Reports of settler arson across multiple West Bank locations, including mosques under construction, kept tensions high.

Geopolitics & Markets: Trump pauses planned Iran strikes after Pentagon warns of interceptor shortages, keeping investors on edge as Netanyahu prepares fresh Iran intelligence for the White House—watching the Strait of Hormuz for oil and crypto spillovers. Energy & Infrastructure Finance: Kuwait’s KPC signs a record $16bn lease-and-leaseback for its crude pipeline network with Blackstone, Brookfield and KKR, while Iran reports $18bn in oil revenues across war and ceasefire periods. Banking & Digital Finance: Qatar’s Dukhan Bank wins “Qatar’s Best Islamic Bank” and “Best Islamic Digital Bank” at Euromoney, highlighting digital onboarding and real-time payments. Regulation & Cyber Risk: US agencies warn Iran-linked actors are targeting internet-exposed water and energy control systems, raising disruption and financial-loss risks. Regional Deal-Making: Pakistan deepens financing ties with China, and Egypt pushes refinery/export momentum as petroleum exports hit a two-year high. Society & Heritage: UNESCO adds West Bank and Lebanese sites to the World Heritage list despite objections, while UN chief Guterres reiterates the Golan is Syrian territory and urges reconstruction support. Security Flash: Israel detains 70+ Palestinians in West Bank raids as settler violence and settlement expansion accelerate.

US-Iran Diplomacy via Pakistan: Pakistan is exploring ways to revive stalled US-Iran talks, with China-backed momentum after Iranian Interior Minister Eskandar Momeni visited Islamabad and met senior officials and army chief Asim Munir, though sources warn major obstacles remain. West Bank Flashpoint: Israel expanded raids and detentions across the occupied West Bank after a Tell shooting killed four Palestinians and two Israelis, with reports of dozens arrested and homes searched in areas including Nablus and Jenin. UN/Heritage Pressure: Palestinians welcomed UNESCO’s listing of Sebastia in the West Bank as World Heritage (and in danger), hoping it limits Israeli control plans; Israel condemned it as political. Syria Recovery Push: UN Secretary-General António Guterres began his first Damascus visit in 17 years, urging international support as Syria rebuilds amid sanctions and ongoing incursions. Crypto Meets Geopolitics: Iran’s vow to keep striking US targets rattled digital assets, with Bitcoin down ~2% and large liquidations reported after the latest escalation. Saudi-PIF Deal: Saudi Arabia’s PIF signed a framework agreement with US EXIM Bank worth up to $15bn to finance eligible PIF portfolio companies and support tech, infrastructure and decarbonisation. Iraq Green Arbaeen: Iraq’s Green Observatory urged greener pilgrimage practices, pushing mawakibs to cut plastic and food waste and improve waste management.

Saudi-US finance: PIF signed an MoU with the US Exim Bank for up to $15bn, aiming to back long-term financing for PIF portfolio firms buying US goods and services, plus cooperation across tech, space, aviation, infrastructure and decarbonisation. Sanctions & crypto: The US Treasury expanded sanctions on Iranian financier Babak Zanjani’s evasion network, targeting entities tied to digital-asset exchanges and related managers/executives. Oil shock & markets: Brent pushed back above $100 as US-Iran tensions and threats to Hormuz and Red Sea routes rattled energy supplies, feeding inflation and rate worries. Iraq infrastructure drag: Iraq reported 1,800+ stalled public projects, with delays blamed on budget approvals and underinvestment, leaving electricity, water and roads lagging. Cross-border payments: UnionPay International signed MoUs with UAE central bank and partners to improve cross-border payment interoperability. Startup/innovation ties: Nigeria and Israel renewed cooperation via the I-FAIR inventor fellowship, with funding secured for a fifth edition starting Oct 2026. Cyber M&A: TAC InfoSec agreed to acquire Israel-based Safehouse Technologies, expanding into consumer cybersecurity. EU trade finance: E3G urged the EU to reset how it uses existing tools for clean trade partnerships.

West Bank Banking Shock: Israeli banks Hapoalim and Discount plan to cut correspondent banking links with Palestinian lenders, raising payment-failure fears as services end in mid/late August. Energy & Markets: Brent reclaimed $100 amid Iran–US escalation and Red Sea tanker attacks; ECB kept rates steady but warned energy-driven inflation risks could push a September hike. Central Banking Watch: Bank of Japan is set to hold its key rate at 1% while monitoring inflation risks tied to Middle East tensions and oil. BRICS Diplomacy: Iran’s interior minister urged BRICS to take a “clear and decisive” stand against attacks on civilians and infrastructure; Iran’s president is also set to attend the BRICS summit in India. Crypto & Risk Sentiment: Bitcoin and Ethereum slid as Middle East worries hit broader markets. Israel Bonds in Europe: Luxembourg confirmed it won’t renew approval for Israel bond sales after 31 August, intensifying pressure on EU financial regulators. Regional Deals: Iran and Iraq signed a broad statement to deepen strategic cooperation after an Iraqi PM visit to Tehran. On-the-ground Flashpoint: Fresh West Bank clashes near Nablus left multiple Palestinians dead and several injured, with Israeli and Palestinian accounts blaming each other.

Red Sea Shipping & Oil Shock: Houthis began enforcing a Red Sea blockade on Saudi Arabia, targeting tankers and pushing Brent above $100, reviving supply-route fears and lifting borrowing/inflation pressure across markets. Rates & Mortgage Costs: US bond yields jumped on renewed Middle East risk, with the 30-year fixed mortgage rate rising to 6.58% (Freddie Mac), feeding higher financing costs for households and businesses. US–Saudi Nuclear Deal Twist: Trump added a new condition that Saudi Arabia must normalize relations with Israel via the Abraham Accords for the civilian nuclear pact to proceed, raising uncertainty over timelines and nonproliferation guardrails. Palestinian Banking Stress: Israeli banks plan to end correspondent banking links with Palestinian lenders (Discount Bank by Sept 1; Bank Hapoalim by Oct 1), threatening a West Bank payment and trade crunch. Iraq–Syria Energy Corridor: Iraq and Syria signed an MoU for an 800-km oil pipeline to Baniyas (capacity ~2.5m bpd), with Chevron and Qatar’s UCC among the execution partners. Syria Investment Push (Digital): Syria signed deals with Saudi tech firms to digitize tourism via a unified reservation and national portal ecosystem. Turkey Monetary Policy: Türkiye’s central bank held its policy rate at 37% amid inflation and regional instability. Egypt–Russia Cooperation: Egypt and Russia discussed logistics for grain/petroleum and seasonal flights, alongside progress on the El Dabaa nuclear project. Sanctions & Hamas Finance: US Treasury sanctioned senior Egyptian Muslim Brotherhood figures and Hamas-linked fundraising fronts, targeting cross-border financial networks.

Middle East Energy Shock: Oil surged toward $100 as US-Iran tensions and Houthi attacks rattled supply routes, with the Strait of Hormuz still a key risk and Gulf states accelerating pipeline plans to bypass it—though the Red Sea is now under threat too. Markets & FX: India’s Sensex and Nifty extended losses for a fourth straight session as crude climbed; the rupee hovered near lows with central bank support, while global risk sentiment stayed fragile. Banking & Rates: Turkey’s central bank held rates at 37%, while Ghana’s central bank kept its policy rate at 14% and analysts say easing may be delayed by renewed Middle East-driven inflation pressure. Regional Trade & Investment: Iraq’s PM arrived in Tehran for energy and investment talks, and the Syrian-Jordanian business council welcomed expanded investor facilities to ease cross-border movement. FinTech/Capital Markets: Emirates Islamic reported strong H1 growth and launched digital gold and silver via its EI+ app; Incorpify unveiled an AI-guided US company formation update and opened a $5m seed round. Macro Outlook: The World Bank warned prolonged conflict could cut global growth to 1.3% and lift inflation.

Iraq-US energy push: Iraq’s Energy Ministry signed deals with US firms worth up to $200bn, aiming to lift crude output (currently ~4.8m bpd) and expand associated gas projects as Baghdad seeks investment while staying within OPEC+ limits. US-Iran escalation hits markets: Oil jumped again as the US warned it would target Iranian bridges or power plants after Hormuz ship attacks; Brent pushed above $95 and volatility stayed elevated, with the IMF warning renewed conflict could drag global growth to 1.3%. Saudi nuclear pact: The US and Saudi Arabia signed a 30-year civilian nuclear cooperation framework that could enable enrichment-related pathways after safeguards review, drawing calls for congressional scrutiny. Iraq banking reform hurdles: Reporting says Iraq’s dollar-access plans may take longer than Prime Minister Ali Al Zaidi suggested, with Treasury clarifying that previously restricted banks have not fully regained foreign-currency access. Pakistan FX lifeline bid: Pakistan formally requested a $10bn US exchange-stabilization fund to support reserves and stabilize the rupee amid economic pressure and its Iran-mediation role. FX watch: Japan signaled it’s ready to intervene as the yen slid toward multi-decade lows, while gold commentary framed the move as dollar strength rather than gold’s loss of real value. Banking results (India): UCO Bank posted ₹656 crore Q1 profit growth, with deposits and advances expanding and fee income rising.

Geopolitics & Markets: US Secretary of State Marco Rubio warned that any Iranian move to control the Strait of Hormuz would set a “dangerous precedent,” as CENTCOM said it has struck Iranian targets for an 11th straight night—keeping shipping and energy risk front and center. Defense Budget Watch: US Defense Secretary Pete Hegseth told US senators the Iran war has cost $37.5bn so far and urged $67bn more for Middle East operations, as lawmakers push for clearer strategy amid protests. Inflation Risk: World Bank chief economist Indermit Gill said renewed escalation could drag global growth to 1.3% in 2026 and lift inflation, with oil and shipping disruptions feeding through to prices and rates. Pakistan FX Lifeline: Reuters reports Pakistan asked the US for a $10bn bilateral exchange stabilization facility after its Iran diplomacy boosted hopes of new support—aimed at easing rupee pressure and strengthening reserves. Iraq Oversight: Iraq’s federal audit bodies are facing scrutiny for failing to detect/report violations and possible concealment of corruption cases, with parliament urged to review performance. Saudi Corporate Finance: Arabian Pipes secured a SAR 68m Aramco contract for steel pipe manufacturing and supply, with revenue impact expected in late 2026/early 2027. Egypt Power Investment: Egypt secured $391m to strengthen electricity transmission and connect Gulf of Suez renewables to the national grid. Banking/Fintech Signals: Egypt’s investment ministry is preparing an “Investor Care Platform” to unify and speed up complaint handling for investors.

Iraq Oversight: Iraq’s Federal Board of Supreme Audit says it’s missing deadlines and legal powers in corruption cases, flagging delays, contract breaches, and financial violations across ministries. US-Iran War Funding: US Defense Secretary Pete Hegseth told senators the Iran conflict has cost $37.5bn so far, as lawmakers weigh a large supplemental spending request amid protests and pushback over “forever war” concerns. Oil & Shipping Shock: Middle East escalation is tightening supply routes: Houthis threaten Red Sea/Bab el-Mandeb disruption, tankers reroute, and oil edges toward $90—raising inflation and rate worries across the region. Lebanon-US Talks: Lebanese President Joseph Aoun met Trump in Washington, pressing for full Israeli withdrawal and support for the Lebanese army and reconstruction; Israel also began withdrawing troops under a US-mediated ceasefire framework. Bahrain Damage Register: Bahrain’s rights body proposes a unified national database and register to document drone/missile damage for future claims and compensation. Egypt Digital & AI Push: The US Embassy in Cairo hosted an AI and fintech-focused forum to deepen Egypt-US tech partnerships. Saudi Debt Management: Saudi Arabia restructured sukuk maturities via repurchases and new longer-dated issuance to reduce refinancing risk and support fiscal sustainability. Payments in Egypt: Paymob and UnionPay expanded digital payment acceptance across Egypt. Crypto Compliance: US Treasury says it froze an Iran-linked IRGC crypto wallet and is tracking assets tied to the ayatollah’s network.