🗞️ In the Midst of a Middle East Crisis — The Theme Is “Uncertainty”
🌍 Geopolitical Risk Moves to the Forefront
Over the weekend,
the Trump administration, in coordination with Israel, reportedly struck Iran’s political leadership.
It has been reported that Supreme Leader Ayatollah Khamenei was killed.
Iran has since launched retaliatory attacks.
Both sides remain hardline,
and the risk of the conflict spreading across the Middle East is rising.
Until recently, markets had leaned toward a scenario in which:
“Third round of U.S.–Iran nuclear talks avoids collapse → negotiations continue.”
Reality has sharply diverged from that expectation.
💱 FX Market Reaction
🔹 Early Week Oceania Session
The dollar gapped higher at the open.
Price action later stabilized, but:
🔹 Dollar Index (DXY)
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Low: 97.768
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High: 98.566 (sharp spike)
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Currently: around 98.22
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Well above last week’s close of 97.608
👉 Clear risk-event dollar buying.
After the surge, some consolidation has emerged,
but levels remain firmly in USD-positive territory.
🛢 Oil Market
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Sharp spike followed by partial pause
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Still elevated
The risk of a Hormuz Strait closure is being priced in,
raising concerns over energy supply and supply-chain disruption.
🧭 Forward Scenarios
① Escalation
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Intensified attacks
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Hormuz closure becomes reality
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Continued crisis-driven USD buying
② Signs of De-escalation
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Position unwinding
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Oil pullback
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USD corrective selling
For now, markets remain heavily headline-driven.
🌏 Medium-Term Risks
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Higher oil → renewed global inflation pressure
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Supply-chain disruption
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Headwinds for energy-importing nations like Japan
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Risk of simultaneous growth slowdown and inflation
The impact could exceed the early phase of the Ukraine war.
📊 Key Data Today
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UK Nationwide house prices
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German retail sales
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Turkey GDP
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Swiss retail sales
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Final European & U.S. Manufacturing PMI
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🇺🇸 U.S. ISM Manufacturing
However, geopolitical developments may overshadow economic data.
🎙 Speaking Events
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BOE’s Taylor
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ECB President Lagarde
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Bundesbank’s Nagel
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BoC Deputy Governor Kozicki
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Others
🔎 Summary
The dominant theme is:
Uncertainty
✔ Crisis-driven dollar demand
✔ Elevated oil prices
✔ Renewed inflation concerns
But after sharp spikes,
position adjustments can emerge quickly.
For now, markets are highly reactive —
prices can jump on a single headline.
Disciplined risk management remains the top priority.
