CNBC Daily Open: President Trump puts ‘open’ sign on Hormuz Island. But there is hardly any traffic

Hello, my name is Hui Jie from Singapore. Welcome to another edition of CNBC’s Daily Open.

Once the store sign changes to “Open”, you can come and go as you please. However, the current geopolitical climate seems to have distorted what it means to be open.

US President Donald Trump insists the Strait of Hormuz is open, but ships have come under attack and shipping through the vital energy waterway has hit its lowest level in three months.

In other words, if the person putting up the open sign is not the true owner of the facility, the credibility of that claim will be scrutinized and access will be blocked.

President Trump on Tuesday ruled out new negotiations with Iran after the temporary ceasefire expired, but said the Strait of Hormuz is “open and functioning.”

“No negotiations or dialogue with the Islamic Republic of Iran has taken place and is not planned,” the US president wrote on Truth Social.

The impasse in negotiations has increased uncertainty over the situation in the Strait of Hormuz, causing a sharp slowdown in shipping traffic through the strait. The five-day average number of ships sailing was just 10, the lowest level since May, according to data from commodity analytics firm Kpler.

The market also does not accept President Trump’s assertion that the strait is navigable. Crude oil prices remain high, brent Oil prices remain above $91 per barrel, but the U.S. west texas intermediate Futures rose 0.52% to $85.38 in early Asian time.

A cargo ship sailing through Oman’s territorial waters known as the “Southern Passage” was attacked while leaving the Strait of Hormuz, killing one crew member. Although the U.S. military supports ships navigating the Southern Passage, Iran continues to successfully attack ships plying the route.

Bond yields soar

U.S. Treasury yields have risen to multi-decade highs as hopes for an end to the conflict in the Middle East fade rapidly.

The jump in yields comes as the U.S. budget deficit rose to $432.3 billion in July, the highest monthly total since March 2021, bringing the year-to-date deficit to nearly $1.8 trillion.

The interest paid to finance the roughly $40 trillion national debt has cost the government about $1.2 trillion this year.

Yields around the world also rose on Tuesday, with Germany’s benchmark 10-year bond yield hitting a 15-year high and Japan’s 10-year bond yield surpassing a 30-year high hit earlier this year.

customs duties will be reinstated

Trade tensions are also back.

President Trump’s 50% tariffs on about $20 billion of Canadian imports are expected to go into effect within hours unless Washington and Ottawa reach a last-minute deal.

Products subject to tariffs include alcohol, dairy products, cement and even plain hockey sticks.

President Trump and Canadian Prime Minister Mark Carney met in the United States late Monday and are scheduled to meet again on Tuesday, according to Bloomberg, but the talks between the leaders Monday night did not seek to persuade Trump to postpone future retaliatory tariffs, Fox Business reported.

— Lim Huijie

Nuclear weapons everywhere? America’s nuclear umbrella unravels, forcing allies to consider defense options

For decades, allies around the world rested in the comfort of the United States’ nuclear umbrella, confident that their own weapons of mass destruction were not needed.

That belief is rapidly disappearing after President Donald Trump’s latest 2026 National Defense Strategy removed explicit mention of extended deterrence, pressuring allies to spend more of their own money on national defense.

The changes are causing more governments to reconsider whether to acquire their own nuclear weapons, raising the risk of a proliferation cascade, analysts say.

— Anique Bao, Lim Hui Jie