Tensions Fuel Oil Price Surge as Yen Continues to Rise
The yen continued to strengthen in Asian trading hours, making it an even less attractive option for carry traders who short the Japanese currency. US Treasury Secretary Bessent's intense calls on traders to stop selling the yen have done little to deter its rise, and some analysts believe that these traders may now shift their attention to shorting the Swiss franc.
Meanwhile, oil prices continued to climb due to escalating tensions in the Middle East. The US has reportedly struck and sunk five Iranian oil tankers, while Iran hit a US airbase in Jordan and reported strikes on ten ships. If the situation continues to deteriorate, it could lead to higher oil prices.
The US equities market remained cautious, with the Dow Jones experiencing significant losses and the Nasdaq remaining stable. The ongoing conflict between the US and Iran has kept investors on edge, with a risk-off attitude prevailing in the market.