The war with Iran has been a big driver of markets.
Oil and gas prices have seesawed as traders try to assess whether, when, and how key waterways, notably the Strait of Hormuz, will open. The movements have boosted energy stocks and hurt big energy consumers, while the resulting higher inflation has hit government bonds.
Global growth has weathered higher prices, but market buffers that cushioned the initial shock are running low.
In the short term, talks between Iran and Oman to manage the Strait of Hormuz are the focus.
Investors with long horizons are mulling geopolitical and economic rebalancing, including potential pipelines avoiding Hormuz and new regional groupings, for example between Saudi Arabia, Pakistan and Turkey.
The U.S. Federal Reserve and the Bank of Japan meet in the same week, potentially creating a double dose of volatility.
What Chair Kevin Warsh says at the Fed's September 16 meeting is as important as what the Fed does: markets see around a 40% chance of a hike.
Warsh, who speaks at the Jackson Hole Symposium on Friday, believes it is important that the Fed takes its cues from the markets, but his sparse communication style has sowed confusion.
Recent U.S. Treasury intervention in bond markets that can dilute market signaling complicates matters.
"How the Fed is going to communicate going forward is important because it impacts their overall credibility and global interest rates," said St. James's Place Chief Investment Officer Justin Onuekwusi.
In Japan, which recently intervened to strengthen the yen, markets expect a BOJ hike on September 18. Its signaling is also key.
"It's all about the narrative and how hawkish the governor sounds," said Hank Calenti, chief strategist, global markets at SMBC EMEA, adding the tone could change the shape of Japan's bond yield curve.
Ten-year yields are nearing 3%, their highest since the mid-1990s.
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