RBNZ Says Pandemic Inflation Taught It Lessons For Future Shocks

The economy and risk assets seem to be telling a conflicting story. In this environment, we believe there’s no better time to be taking a multi-asset approach to investing.In recent weeks U.S. and global equities have routinely hit record highs, credit spreads continue to trade at historic tights, and the VIX index of volatility is near its lows for the year so far.Few would have taken the bet six months ago that risk assets would be performing this way after markets plummeted at the beginning of April; even fewer would have done so had they had full visibility of the macroeconomic weak spots and current levels of fiscal and tariff impact uncertainty and geopolitical risk.

What this points to is the paradox seemingly playing out between a challenged economy and roaring risk markets; a conflict that, as we enter the final quarter of the year, looks unlikely to fade anytime soon.The questions then are how to explain it, and what might investors do about it?

Reasons to be Cautious

We don’t have to look hard to see where some of the weak spots and risks are in the economic picture.There has been a clear deterioration in most of the U.S. employment and inflation data in the last several weeks, so much so that the Federal Reserve has re-engaged its rate-cutting cycle with the market pricing in 120 basis points of cuts in the next 12 months. Last week we saw core PCE inflation for July come in at 2.9% (annualized)—still well above the Fed’s 2% inflation target—and this week attention will focus on nonfarm payrolls and the unemployment data, two areas that have been a cause of some concern.

Together with this, the independence of the Fed is in focus and uncertainty persists around the economic impact of tariffs as well as on fiscal policy and sustainability.Concerns around these macro issues are similarly elevated among other major economies, particularly France, the U.K. and Japan, all of which have also seen related volatility at the long-end of their yield curves due to worries over their fiscal challenges. Growth in these economies is also sluggish.

To add to the mix, geopolitical risk remains at historic highs, with fresh spikes this month from Russia violating Polish, Estonian and Romanian airspace, and Israel carrying out a strike in Qatar against Hamas’ leadership.Although these acts have not had a sustained negative market impact, such as higher oil prices or a sharp fall in equities, the risk of broader escalation remains high.Importantly, these fears aren’t abstract. Most notably, gold prices recently hit an all-time high in real terms, exceeding the ‘safe-haven’ asset’s previous inflation-adjusted peak from 1980.

Optimism Amid the Pessimism

Remarkably, despite this pessimistic background, risk markets have ripped higher.

In our view, there are several reasons that may help explain why.

First, the continued resilience of the U.S. economy has been impressive, and while there are clear signs of weakness in employment and threats of higher inflation, these signs and others are not strong or numerous enough to indicate a recession, which would provoke an aggressive risk-off move in markets. Growth has, of course, moderated, but markets have rationalized the primary causes and effects and seem to have concluded that the U.S. economy, once again supported by monetary easing, is in decent shape and poised to slowly re-accelerate.

This optimistic view appears, for now, to override any developing concerns around the independence of the Fed and the U.S.’ fiscal challenges.Second, in the event of a serious downturn, major central banks have more space to step in and cut rates than they have had in more than a decade, which is surely giving markets some comfort. Such action is more credible today because rates are higher than where they have been, and with inflation broadly slowing and back under control, there is more scope for deeper cuts should they be needed.

Third, the continued power and earnings growth of the mega-cap U.S. technology companies—ultimately the ‘Magnificent 7’—and parallel improvement in earnings across a broader universe of companies, industries and geographies has been a surprise to the upside. Coming into the year there was some expectation U.S. mega-cap tech company earnings would decelerate. Clearly this hasn’t happened, and the broadening-out story has gained momentum, buttressing U.S. and international equity markets.

Importantly, monetary easing and a weak U.S. dollar have also been key factors supporting, if not catalyzing, global equities. U.S. and non-U.S. fixed income have benefited from this too.Fourth, corporate credit quality across investment grade and sub-investment grade markets is generally robust despite relatively high rates, particularly in the U.S., and persistence of economic and policy uncertainty. The current historically tight credit spread levels reflect this dynamic and the healthy depth of demand from investors, drawn in by the attractive all-in yields of corporate and high-yield bonds. Providing additional support to this is that corporate default rates globally remain relatively low.

Finally, while geopolitical risk remains elevated and may reasonably be expected to spike again in the near-term, markets seem inured to it and are only unnerved by a full-scale war or other humanitarian disaster that affects economic forecasts or asset prices, particularly currencies and oil.

What This Means for Investors

Without doubt, we are in an unusual environment right now; one that feels as complex as it is unpredictable. As such, investors should rightly be cautious about where we go from here.However, while conscious of the economic weaknesses and the risks, we remain optimistic in our outlook for growth and risk assets over the medium term, a view that has been consistent throughout the year.

In equities, in particular, optimism is clearly being priced in. But we don’t believe there is an irrational exuberance and overextension in allocations, not least because absolute yields in fixed income remain attractive.What’s important, especially now, is that investors ensure portfolios are as diversified as they can be across multiple asset classes, providing a balance of exposures across public and private markets that blend attractive sources of risk-adjusted returns with sufficient downside protection.Multi-asset investing works through the cycles. It’s during times like these that it comes to the fore.

Source: Neuberger Berman

The central bank kept rates steady at 0.5% earlier this month, as expected, but dissenting calls by two board members for a quarter point hike stunned markets and were read as a sign the BOJ was less worried about economic headwinds than first thought.

While it is uncertain whether the move was designed as an intentional signal to markets a rate hike was imminent, veteran BOJ watcher Mari Iwashita said it represented a growing board view that conditions for the next rise were falling into place.

"The dissenters probably wanted to nudge Ueda to move faster and get a rate hike done, given it was something that would happen sooner or later," Iwashita said.

Since taking the helm at the BOJ in 2023, Ueda has delivered the bank's first rate hike in 17 years but has in the past six months grown more cautious about the outlook.

Ueda's dovishness contrasts with a shift in views among others in the BOJ's nine-member board in recent months, who are calling for more rate hikes.

Board members Naoki Tamura and Hajime Takata surprised markets by proposing a rate hike at the BOJ's decision in September.

The exact timing of the next hike rests on whether upcoming data convince BOJ policymakers the U.S. will avert a recession, and U.S. levies won't derail Japan's fragile economic recovery, said sources familiar with the central bank's thinking.

At the same time, mounting price pressure has been worrying the board since as early as July. While some members expected food inflation to dissipate, others warned that steady price rises of daily necessities could unleash broad-based, persistent inflation, minutes of the July 30-31 meeting showed.

For the most part, policymakers seem to be looking through recent economic weakness.

Of the six opinions on the monetary policy outlook, all but one called for raising rates in a timely fashion with one seeing the chance of doing so by year-end, the July minutes showed.

Since then, data has shown limited economic damage from U.S. tariffs with some policymakers viewing an August drop in exports as largely a reaction to pent-up demand in prior months.

While dismal jobs data stoked fears of U.S. recession, such concern has eased as the economy shows resilience and prospects that rate cuts by the Federal Reserve would underpin growth.

The dissenters may find more allies in the nine-member board if upcoming data further ease concern of a steep U.S. downturn, and show Japan's manufacturers can weather the hit from U.S. levies, said one of the sources.

"It's crucial that there were two, not one, dissenters," said the source, who spoke on condition of anonymity as he was not authorised to speak publicly. "This could sway other members more in favour of a near-term rate hike."

While BOJ policymakers have been mum on the pace and timing of future rate hikes, there is broad consensus it will come at one of the three meetings by January next year, the sources say.

Markets have priced in roughly a 50% chance of a rate hike in October. A Reuters poll showed a majority of economists expect another 25-basis-point hike by year-end, although there was less conviction about the timing with bets centering on October and January.

NOT ABOUT LOGIC

A former commercial banker, Tamura is a well-known hawk who made a solo, unsuccessful proposal in December to hike rates to 0.5% - only to see the BOJ do just that a month later.

The significance of the split vote was heightened by the dissent of Takata, who has always voted in favour of Ueda's proposal and was seen holding views close to those of the governor, analysts say.

"Though it's hard to tell, the dissents could have been an intentional signal to markets that a rate hike is approaching," former BOJ board member Makoto Sakurai told Reuters.

The board's hawkish bias contrasts with a generation of dovish policymakers who dominated during the era of Ueda's predecessor Haruhiko Kuroda, but have since bowed out.

Newcomer Junko Koeda, who succeeded Adachi, has expressed concerns about rising food prices.

Another newcomer, Kazuyuki Masu, is seen as neutral on policy and replaced Toyoaki Nakamura, a dove who repeatedly dissented from the BOJ's decision to phase out stimulus.

That has left Ueda as the most cautious board member.

Some analysts doubt whether enough data would come out by the October 29-30 meeting to convince Ueda, who has huge sway on the rate decision, to pull the trigger.

"Judging from his recent remarks, I don't think he's convinced that conditions for a hike are in place," said former BOJ board member Seiji Adachi, who sat on the board until March.

Among key data coming out is the BOJ's "tankan" business survey, due on October 1, which will show how U.S. tariffs are affecting businesses. A report by the BOJ's regional branch managers, due on October 6, will give an overview of how smaller firms are weathering tariffs.

In the end, politics and exchange-rate moves could be a key factor swaying the rate-hike timing, especially as Prime Minister Shigeru Ishiba steps down.

Concerns his replacement could meddle in monetary policy have receded with none of the candidates, including advocate of monetary easing Sanae Takaichi, opposing rate hikes. One even backed moderate increases in borrowing costs.

A renewed fall in the yen, which has weakened to near the critical 150 line to the dollar, may pressure the BOJ to hike rates as it accelerates inflation by lifting import costs, analysts say.

"Given how much Ueda stressed downside economic risks, it's logically hard to justify a rate hike in October," Adachi said. "But sometimes, it's not just about logic."

Source: Reuters

A man who crashed his vehicle through the front doors of a Mormon church in Michigan opened fire with an assault rifle and set the church ablaze, killing at least four people and wounding at least eight others before dying in a shootout with police, officials said.Police said the perpetrator, identified as Thomas Jacob Sanford, 40, a former U.S. Marine from the nearby town of Burton, deliberately set fire to the church, which was engulfed in flames and billowing smoke.Two of the shooting victims died and eight others were hospitalized, officials said. Several hours after the shooting, police reported finding at least two more bodies in the charred remains of the church, which had not yet been cleared and may contain other victims.

"There are some that are unaccounted for," Grand Blanc Township Police Chief William Renye told a press conference.Hundreds of people were in the church when Sanford drove into the building, Renye said.Two law enforcement officers, one from the state Department of Natural Resources and another from Grand Blanc Township, rushed to the scene within 30 seconds of receiving calls and engaged the suspect in an exchange of gunfire, shooting him dead in the parking lot about eight minutes after the incident began, Renye said.

Investigators will search the shooter's home and phone records in search of a motive, Renye said.U.S. military records show Sanford was a U.S. Marine from 2004 to 2008 and an Iraq war veteran.Coincidentally, another 40-year-old Marine veteran who served in Iraq is a suspect in a North Carolina shooting that killed three people and wounded five others less than 14 hours before the Michigan incident.Police in Southport, North Carolina, accused Nigel Max Edge of firing on a waterfront bar from a boat on Saturday night. Edge has been charged with three counts of first-degree murder and five counts of attempted murder, police said.

According to court records, a federal lawsuit that Edge had filed against the U.S. government, and others, describes him as a decorated Marine who suffered severe wounds including traumatic brain injury in Iraq. The lawsuit, which was dismissed, showed Edge was previously known as Sean William DeBevoise before changing his name.

'SURREAL' ESCAPE

In Michigan, a woman who gave her name as Paula described her escape as “surreal” in an interview with WXYZ television.“We heard a big bang and the doors blew. And then everybody rushed out,” she said, adding that there was no security and the shooter opened fire on parishioners as they fled.“I lost friends in there and some of my little primary children that I teach on Sundays were hurt. It’s very devastating for me," she said.The Mormons, formally known as the Church of Jesus Christ of Latter-day Saints, follow the teachings of Jesus but also the prophecies of Joseph Smith, a 19th century American.

Grand Blanc, a town of 7,700 people, is about 60 miles (100 km) northwest of Detroit.“My heart is breaking for the Grand Blanc community," Michigan Governor Gretchen Whitmer said in a statement posted to social media. "Violence anywhere especially in a place of worship, is unacceptable."President Donald Trump in a statement on Truth Social said that the shooting "appears to be yet another targeted attack on Christians in the United States of America" and said the FBI was on the scene. "THIS EPIDEMIC OF VIOLENCE IN OUR COUNTRY MUST END, IMMEDIATELY!"

The Michigan rampage marked the 324th mass shooting in the U.S. in 2025, according to the Gun Violence Archive, which tracks such incidents and describes a mass shooting as one in which four or more people are shot or killed, not including the shooter.It was also the third U.S. mass shooting in less than 24 hours, including the North Carolina incident and a shooting a few hours later at a casino in Eagle Pass, Texas, that killed at least two people and injured several others.

Source: Reuters

A hawkish board split at the Bank of Japan's policy meeting this month has increased pressure on its dovish governor Kazuo Ueda to move faster on interest rate hikes, raising the prospect the next tightening could come as soon as October.The central bank kept rates steady at 0.5% earlier this month, as expected, but dissenting calls by two board members for a quarter point hike stunned markets and were read as a sign the BOJ was less worried about economic headwinds than first thought.

While it is uncertain whether the move was designed as an intentional signal to markets a rate hike was imminent, veteran BOJ watcher Mari Iwashita said it represented a growing board view that conditions for the next rise were falling into place."The dissenters probably wanted to nudge Ueda to move faster and get a rate hike done, given it was something that would happen sooner or later," Iwashita said.Since taking the helm at the BOJ in 2023, Ueda has delivered the bank's first rate hike in 17 years but has in the past six months grown more cautious about the outlook.

Ueda's dovishness contrasts with a shift in views among others in the BOJ's nine-member board in recent months, who are calling for more rate hikes.Board members Naoki Tamura and Hajime Takata surprised markets by proposing a rate hike at the BOJ's decision in September.The exact timing of the next hike rests on whether upcoming data convince BOJ policymakers the U.S. will avert a recession, and U.S. levies won't derail Japan's fragile economic recovery, said sources familiar with the central bank's thinking.

At the same time, mounting price pressure has been worrying the board since as early as July. While some members expected food inflation to dissipate, others warned that steady price rises of daily necessities could unleash broad-based, persistent inflation, minutes of the July 30-31 meeting showed.For the most part, policymakers seem to be looking through recent economic weakness.Of the six opinions on the monetary policy outlook, all but one called for raising rates in a timely fashion with one seeing the chance of doing so by year-end, the July minutes showed.

Since then, data has shown limited economic damage from U.S. tariffs with some policymakers viewing an August drop in exports as largely a reaction to pent-up demand in prior months.While dismal jobs data stoked fears of U.S. recession, such concern has eased as the economy shows resilience and prospects that rate cuts by the Federal Reserve would underpin growth.The dissenters may find more allies in the nine-member board if upcoming data further ease concern of a steep U.S. downturn, and show Japan's manufacturers can weather the hit from U.S. levies, said one of the sources.

"It's crucial that there were two, not one, dissenters," said the source, who spoke on condition of anonymity as he was not authorised to speak publicly. "This could sway other members more in favour of a near-term rate hike."While BOJ policymakers have been mum on the pace and timing of future rate hikes, there is broad consensus it will come at one of the three meetings by January next year, the sources say.

Markets have priced in roughly a 50% chance of a rate hike in October. A Reuters poll showed a majority of economists expect another 25-basis-point hike by year-end, although there was less conviction about the timing with bets centering on October and January.

NOT ABOUT LOGIC

A former commercial banker, Tamura is a well-known hawk who made a solo, unsuccessful proposal in December to hike rates to 0.5% - only to see the BOJ do just that a month later.The significance of the split vote was heightened by the dissent of Takata, who has always voted in favour of Ueda's proposal and was seen holding views close to those of the governor, analysts say."Though it's hard to tell, the dissents could have been an intentional signal to markets that a rate hike is approaching," former BOJ board member Makoto Sakurai told Reuters.

The board's hawkish bias contrasts with a generation of dovish policymakers who dominated during the era of Ueda's predecessor Haruhiko Kuroda, but have since bowed out.Newcomer Junko Koeda, who succeeded Adachi, has expressed concerns about rising food prices.Another newcomer, Kazuyuki Masu, is seen as neutral on policy and replaced Toyoaki Nakamura, a dove who repeatedly dissented from the BOJ's decision to phase out stimulus.

That has left Ueda as the most cautious board member.

Some analysts doubt whether enough data would come out by the October 29-30 meeting to convince Ueda, who has huge sway on the rate decision, to pull the trigger."Judging from his recent remarks, I don't think he's convinced that conditions for a hike are in place," said former BOJ board member Seiji Adachi, who sat on the board until March.Among key data coming out is the BOJ's "tankan" business survey, due on October 1, which will show how U.S. tariffs are affecting businesses. A report by the BOJ's regional branch managers, due on October 6, will give an overview of how smaller firms are weathering tariffs.

In the end, politics and exchange-rate moves could be a key factor swaying the rate-hike timing, especially as Prime Minister Shigeru Ishiba steps down.Concerns his replacement could meddle in monetary policy have receded with none of the candidates, including advocate of monetary easing Sanae Takaichi, opposing rate hikes. One even backed moderate increases in borrowing costs.A renewed fall in the yen, which has weakened to near the critical 150 line to the dollar, may pressure the BOJ to hike rates as it accelerates inflation by lifting import costs, analysts say.

"Given how much Ueda stressed downside economic risks, it's logically hard to justify a rate hike in October," Adachi said. "But sometimes, it's not just about logic."

Source: Yahoo Finance

In trading, patterns are powerful tools, allowing traders to anticipate changes in trend direction. One such pattern is the inverted hammer, a formation often seen as a bullish signal following a downtrend. Recognising this pattern and understanding its implications can be crucial for traders looking to spot reversal opportunities. In this article, we will explore the meaning of inverted hammer candlestick, how to identify it on a price chart, and how traders can incorporate it into their trading strategies.

What Is an Inverted Hammer?

An inverted hammer is a candlestick pattern that appears at the end of a downtrend, typically signalling a potential bullish reversal. It has a distinct shape, with a small body at the lower end of the candle and a long upper wick that is at least twice the size of the body. This structure suggests that although sellers initially dominated, buyers stepped in, pushing prices higher before closing near the opening level. While the inverted hammer alone does not confirm a reversal, it’s often considered a sign of a possible trend change when followed by a bullish move on subsequent candles.

The pattern can have any colour so that you can find a red inverted hammer candlestick or upside down green hammer. Although both will signal a bullish reversal, an inverted green hammer candle is believed to provide a stronger signal, reflecting the strength of bulls.

One of the unique features of this pattern is that traders can apply it to various financial instruments, such as stocks, cryptocurrencies*, ETFs, indices, and forex, across different timeframes.

Hammer vs Inverted Hammer

The hammer and inverted hammer are both single-candle patterns that appear in downtrends and signal potential bullish reversals, but they have distinct formations and implications:

Both patterns signal possible bullish sentiment, but while the green or red hammer candlestick focuses on buyer strength after selling, the inverted hammer suggests buyer interest in an overall bearish context, needing further confirmation for a trend shift.

How Traders Identify the Inverted Hammer Candlestick in Charts

Although the inverted hammer is easy to recognise, there are some rules traders follow to increase the reliability of the reversal signal it provides.

Step 1: Identify the Pattern in a Downtrend

Step 2: Choose Appropriate Timeframes

Step 3: Use Indicators to Strengthen Identification

Step 4: Look for Confirmation Signals

By following these steps and waiting for confirmation signals, traders can increase the reliability of the inverted hammer’s signals.

Trading the Inverted Hammer Candlestick Pattern

Trading the inverted hammer involves implementing a systematic approach to capitalise on potential bullish reversals. Here are some steps traders may consider when trading:

Inverted Hammer Candlestick: Live Market Example

The trader looks for a bullish inverted hammer on the USDJPY chart. After a subsequent downtrend, the inverted hammer provides a buying opportunity that aligns with the support level. They enter the market at the close of the inverted hammer candle and place a stop loss below the support level. Their take-profit target is at the next resistance level.A trader could implement a more conservative approach and wait for at least a few candles to form in the uptrend direction. However, as the pattern was formed at the 5-minute chart, a trader could lose a trading opportunity or enter the market with a poor risk-reward ratio.

Advantages and Limitations of Using the Inverted Hammer

The inverted hammer has its strengths and limitations. Here’s a closer look:

Advantages

Limitations

Final Thoughts

While the inverted hammer can provide valuable insights into potential trend reversals, it should not be the sole basis for trading decisions. It is important to supplement analysis with other technical indicators and tools to strengthen the overall trading strategy. Furthermore, effective risk management strategies are crucial while trading the setup. Setting appropriate stop-loss orders to limit potential losses and implementing proper position sizing techniques can help potentially mitigate risks and protect trading capital.

FAQ

Is an Inverted Hammer Bullish?

Yes, it is considered a bullish reversal pattern. It indicates a potential shift from a downtrend to an uptrend in the market. While it may seem counterintuitive due to its name, the setup suggests that buying pressure has overcome selling pressure and that bulls are gaining strength.

How Do You Trade an Inverted Hammer?

To trade an inverted hammer, traders wait for confirmation in the next session, such as a gap-up or strong bullish candle. They usually enter a buy position with a stop-loss below the low of the pattern to potentially manage risk and a take-profit level at the closest resistance level.

Is the Inverted Hammer a Trend Reversal Signal?

It is generally considered a potential trend reversal signal. An inverted hammer in a downtrend suggests a shift in market sentiment from bearish to bullish. An inverted hammer in an uptrend does not signify anything.

What Happens After a Reverse Hammer Candlestick?

After a reverse (or inverted) hammer candle, there may be a potential bullish reversal if confirmed by a strong bullish candle in the next session. However, without confirmation, the pattern alone does not guarantee a trend change.

How Do You Trade an Inverted Hammer Candlestick in an Uptrend?

In an uptrend, an inverted hammer isn’t generally considered significant because it’s primarily a reversal signal in a downtrend.

Are Inverted Hammer and Shooting Star the Same?

No, the inverted hammer and shooting star look similar but occur in opposite trends; the former appears in a downtrend as a bullish reversal signal, while the latter appears in an uptrend as a bearish reversal signal.

What Is the Difference Between a Hanging Man and an Inverted Hammer?

The hanging man and inverted hammer differ in both appearance and context. The former appears at the end of an uptrend as a bearish signal and has a small body and a long lower shadow, while the latter appears at the end of a downtrend as a bullish signal and has a small body and a long upper shadow.

What Is the Difference Between a Red and Green Inverted Hammer?

A green (bullish) inverted hammer candlestick closes higher than its opening price, indicating a stronger bullish sentiment. A red (bearish) inverted hammer candlestick closes lower than its opening, which might indicate less buying strength, but both colours can signal a reversal if followed by confirmation.

Source: FXOpen

Summary

U.S. President Donald Trump hopes to finalize a Gaza peace plan proposal in a meeting on Monday with Israel's Prime Minister, Trump told Reuters on Sunday, as Israeli tanks pushed deeper into Gaza City and the military wing of Hamas said it had lost contact with two hostages held there.

The fate of the two hostages, which has strong domestic resonance in Israel, could cast a shadow over a meeting between Israeli Prime Minister Benjamin Netanyahu and Trump on Monday.

The Hamas military wing, Al-Qassam Brigades, called on Israel on Sunday to pull troops back and suspend air strikes on Gaza City for 24 hours so fighters could retrieve the captives.

Trump told Reuters in a phone interview he had received a "very good response" from Israel and Arab leaders to the Gaza peace plan proposal and that "everybody wants to make a deal."

Hamas said the group had not yet received any proposal from Trump nor from mediators.

Israel has launched a massive ground assault on Gaza City, flattening whole districts and ordering hundreds of thousands of Palestinians to flee to tented camps, in what Netanyahu says is a bid to destroy Hamas.

Nevertheless, the past few days have seen increasing talk of a diplomatic resolution to the nearly two-year-old Gaza war.

Trump's 21-point Middle East peace plan to end the Gaza war calls for the return of all Israeli hostages, living and dead, no further Israeli attacks on Qatar and a new dialogue between Israel and Palestinians for “peaceful coexistence.”

HAMAS URGES ISRAELI MILITARY TO PULL BACK

Netanyahu has repeatedly said Hamas must lay down its arms or be defeated. He told Fox News earlier on Sunday it is possible to have amnesty for Hamas leaders under a ceasefire agreement that would include them being escorted out of Gaza.

Hamas has so far said it will never give up its weapons as long as Palestinians are struggling for a state. It refuses any expulsion of its leaders from Gaza.

Al-Qassam Brigades called on the Israeli military to pull troops back from the Sabra and Tel Al-Hawa districts southeast of Gaza City's centre, and suspend flights over the area for 24 hours from 1500 GMT so it could reach the two trapped hostages.

The Israeli military did not directly comment on the request but made clear it had no plans to halt its advances, issuing a statement ordering all residents of parts of Gaza City including the Sabra district to leave. It said it was about to attack Hamas targets and raze buildings in the area.

Gaza residents and medics said Israeli tanks pushed deeper into Sabra, Tel Al-Hawa and nearby Sheikh Radwan and Al-Naser neighbourhoods, closing in on the heart of the city and western areas where hundreds of thousands of people are sheltering.

RESCUERS UNABLE TO REACH TRAPPED RESIDENTS

The Gaza health ministry said in a statement that at least 77 people had been killed by Israeli fire in the past 24 hours.

Local health authorities said they had been unable to respond to dozens of desperate calls from trapped residents.

Gaza's Civil Emergency Service said late on Saturday that Israel had denied 73 requests, sent via international organisations, to let it rescue injured Palestinians in Gaza City. The Israeli military had no immediate comment.

The families of the two hostages identified by Hamas have requested that their names not be published by the media.

The war began after Hamas-led militants attacked Israeli territory in October 2023, killing around 1,200 people and capturing 251 hostages, according to Israeli tallies. Forty-eight hostages are still in Gaza, 20 of whom Netanyahu says are still alive.

Israel's assault has killed more than 66,000 Palestinians, according to medical authorities in the territory. Most homes have been damaged or destroyed and 2.3 million residents are living under a severe humanitarian crisis.

The Israeli military says Hamas, which ruled Gaza for nearly two decades, no longer has governing capacity and that its military force has been reduced to a guerrilla movement.

The military launched its long-threatened ground offensive on Gaza City on September 16 after weeks of intensifying strikes on the urban centre.

Over the past 24 hours, the air force had struck 140 military targets across Gaza, including militants and what it described as military infrastructure, the military said.

The World Food Programme estimates that between 350,000 and 400,000 Palestinians have fled Gaza City since last month, although hundreds of thousands remain. The Israeli military estimates that around a million Palestinians were in Gaza City in August.

Reporting by Nidal al-Mughrabi in Cairo; Additional reporting by Steven Scheer, Alexander Cornwell and May Angel in Jerusalem and Ahmed Tolba in Cairo; Writing by Nia Williams; Editing by David Holmes, Peter Graff and Diane Craft

Source: Reuters