The Jamieson Greer has told Mexican industry leaders that tariffs imposed by Donald Trump will remain in place, even as negotiations to revise the United States-Mexico-Canada Agreement intensify ahead of a July review deadline.
The remarks, delivered during meetings in Mexico City, signal a major shift from decades of tariff free trade under USMCA and its predecessor NAFTA.
According to multiple sources, Greer made it clear that the United States does not intend to return to a zero tariff framework.
This marks a fundamental change in North American trade policy, where free trade in autos and parts had been the norm for over 30 years. The introduction of tariffs, including a 25 percent duty on automotive imports, has disrupted deeply integrated supply chains across the region.
The implications for Mexico are significant:
These pressures have weakened Mexico’s competitive position, especially as the United States has negotiated lower tariffs with other partners.
U.S. negotiators are also pushing for stricter rules of origin.
Proposals include requiring 100 percent North American sourcing for key components such as engines and electronics, up from current thresholds of around 75 percent. This would force manufacturers to further regionalize supply chains, potentially increasing costs but aligning with Washington’s goal of boosting domestic production.
The Mexican government, led by Claudia Sheinbaum, is seeking relief from tariffs as part of the USMCA review. Officials aim to secure at least partial reductions, particularly in the auto and steel sectors, before finalizing broader trade revisions.
However, the latest signals from Washington suggest that while some easing may be possible, a full rollback is unlikely.
This development underscores a broader shift in global trade policy away from pure free trade toward managed trade and economic security.
For Mexico, the stakes are high due to its deep economic integration with the United States. Persistent tariffs could reshape manufacturing patterns, investment decisions, and employment across North America.
Formal negotiations are set to begin in late May, with both sides aiming to resolve key disputes before the July deadline.
Key areas of focus will include:
The outcome will determine the future structure of North American trade.
The U.S. position reflects a strategic recalibration rather than a temporary policy shift. By normalizing tariffs, Washington is prioritizing domestic industry and supply chain control over traditional free trade principles.
For Mexico, this creates a structural challenge. Its export driven model, built on open access to the U.S. market, now faces persistent barriers. While some adjustments may preserve competitiveness, the era of frictionless trade appears to be over.
Ultimately, the negotiations will test whether North America can adapt to a new trade paradigm or whether tensions will deepen within one of the world’s most integrated economic regions.
With information from Reuters.
Brent crude rises more than 7 percent as Washington and Tehran offer conflicting accounts on ceasefire negotiations.
Published On 20 Apr 202620 Apr 2026
Oil prices have risen sharply following attacks on commercial vessels in the Strait of Hormuz and conflicting messages about the prospect of renewed negotiations between the United States and Iran.
Brent crude futures, the primary benchmark for global prices, jumped more than 7 percent in Asia on Monday as the outlook for peace between Washington and Tehran darkened.
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Prices eased somewhat later in the morning, with the benchmark at $94.69 a barrel as of 02:05 GMT, up from just under $90.40 on Friday.
The latest price surge came after US President Donald Trump said US forces seized an Iranian-flagged cargo vessel that had attempted to evade the US blockade of Iran’s ports.
Trump’s announcement followed reports by the United Kingdom Maritime Trade Operations (UKMTO) Centre over the weekend that two vessels came under attack while transiting the strait.
Iranian gunboats fired on a tanker, while an “unknown projectile” struck a container ship, according to the UKMTO.
After declaring the strait “completely open” on Friday, Tehran reversed course less than 24 hours later, citing the ongoing US blockade.
Earlier on Sunday, Trump said that a US delegation would travel to Pakistan on Monday to hold a second round of ceasefire talks with Iranian officials.
Iranian state news outlet IRNA later reported that Tehran would not participate in the talks, citing the US blockade and Washington’s “excessive demands” and “unrealistic expectations”.
A two-week ceasefire between Washington and Tehran is set to expire on Wednesday if the sides cannot agree on an extension.
An initial round of talks held in Islamabad earlier this month broke down without any agreement between the sides.
Iran’s effective closure of the strait, which usually carries about one-fifth of global oil and natural gas supplies, has driven a surge in fuel prices worldwide, forcing governments to tap emergency supplies and roll out energy-saving measures.
Nineteen vessels crossed the strait on Saturday, up from 10 the previous day, but far below the historical average of 138 daily transits, according to the UKMTO.
Asia’s main stock markets opened higher on Monday despite the dimming prospects of de-escalation.
Japan’s Nikkei 225 rose more than 1 percent in morning trading, while South Korea’s KOSPI gained about 1.3 percent.
Hong Kong’s Hang Seng Index rose about 0.5 percent, while the SSE Composite Index in Shanghai gained more than 0.4 percent.
Dmitry Vinogradov
Stock index futures were muted on Friday as President Donald Trump signaled that the U.S. and Iran could hold talks over the weekend, boosting optimism that Middle East tensions may be easing.
Dow futures (INDU) rose 0.27%, while S&P 500
Donald Trump has indicated that the conflict with Iran could conclude “soon,” citing progress in negotiations and a possible meeting between the two sides in the coming days. A temporary ceasefire between Israel and Lebanon has added to cautious optimism, though the broader regional situation remains unstable. The war, which began with U.S.-Israeli military action, has had sweeping geopolitical and economic consequences.
Ceasefire in Lebanon:
A 10-day truce between Israel and Lebanon has come into effect, offering a brief pause in cross-border hostilities. However, early reports of violations underline the fragility of the arrangement. Hezbollah, aligned with Iran, has been urged by Washington to maintain restraint during this critical window.
Diplomatic Breakthrough Efforts:
Backchannel diplomacy, with Pakistan playing a mediating role, has reportedly led to progress on key issues. Talks are expected to produce an initial memorandum of understanding, potentially followed by a comprehensive agreement within weeks. Engagement between U.S. and Iranian officials is likely to intensify in the immediate term.
Global Economic Shock:
The conflict has disrupted global energy flows, particularly through the Strait of Hormuz, through which a significant share of the world’s oil supply passes. This has triggered sharp oil price fluctuations and raised concerns about a broader economic slowdown, even as markets show signs of stabilizing on hopes of a resolution.
Nuclear Issue as Core Dispute:
Iran’s nuclear program remains the central obstacle in negotiations. Washington is pushing for long-term restrictions, while Tehran seeks shorter commitments and the lifting of sanctions. Bridging this gap will be critical to securing a durable settlement.
Political Pressures and Regional Stakes:
The war has created domestic political challenges for Trump, particularly ahead of upcoming elections. At the same time, regional actors are closely watching the outcome, as any agreement will shape the balance of power and security dynamics across the Middle East.
Analysis:
Momentum toward a deal is clearly building, but the situation remains precarious. The ceasefire in Lebanon and progress in diplomacy suggest a window of opportunity, yet unresolved issues, especially around nuclear limits and sanctions relief, could still derail negotiations. Trump’s urgency reflects both strategic calculation and domestic political pressure, while Iran appears willing to engage but not at any cost. If a preliminary agreement is reached, it would mark a significant de-escalation, but sustaining peace will require careful management of deep-rooted tensions and competing interests on all sides.
With information from Reuters.
KeyCorp plans to repurchase at least $1.3 billion in shares in 2026, raised from prior guidance of $1.2 billion, and indicated that Basel III revisions could add over 100 basis points to CET1, potentially enabling even more buybacks if market conditions allow.
Norway is preparing to lift restrictions preventing its $2.2 trillion sovereign wealth fund from investing in government bonds issued by Syria.
The move follows the political transition after the ousting of Bashar al-Assad and the rise of Ahmed al-Sharaa, whose government has been seeking economic recovery and international reintegration after more than a decade of war and sanctions.
At the same time, Norway plans to newly restrict investments in bonds issued by Iran, aligning with ongoing international sanctions.
The Norwegian sovereign wealth fund, the largest in the world, plays a major role in global financial markets. Its investment decisions often influence broader investor behaviour.
The updated policy removes Syria from the exclusion list for government bonds while adding Iran, reflecting changing geopolitical and sanctions dynamics.
Although the fund does not currently hold investments in Middle Eastern government bonds, the policy shift opens the door for future allocations and signals a reassessment of risk and legitimacy.
Norway’s decision represents a notable step toward Syria’s re-entry into the global financial system. It comes alongside other developments, including the restoration of Syria’s financial links with international institutions after years of isolation.
The move also highlights a divergence in how states are being treated: while Syria is gradually being reintegrated, Iran remains economically isolated due to continued tensions and sanctions.
As one of the world’s most influential sovereign investors, Norway’s stance could encourage other countries and institutions to reconsider their own restrictions on Syria.
The decision reflects a broader recalibration of international economic engagement based on political change and shifting strategic priorities. By opening the possibility of investment in Syrian bonds, Norway is signalling cautious confidence in the new government’s direction and stability.
At the same time, the move remains largely symbolic in the short term. The wealth fund has no immediate exposure to Syrian debt, and actual investment will depend on risk assessments, market conditions, and institutional safeguards.
More importantly, the policy underscores how financial tools are increasingly used as instruments of foreign policy. Inclusion or exclusion from global capital markets can legitimise governments, incentivise reforms, or reinforce isolation.
In Syria’s case, gradual financial reintegration could support reconstruction and economic recovery, but it also raises questions about governance, transparency, and long-term stability after years of conflict.
With information from Reuters.
The US president has lashed out at European partners for declining to contribute military forces to the war on Iran.
United States President Donald Trump has reportedly discussed withdrawing from NATO, the transatlantic alliance that has been a central pillar of Western security for decades.
At a news briefing on Wednesday, White House Press Secretary Karoline Leavitt framed the US and Israel’s war on Iran as a “test” that the alliance had failed.
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Despite Trump’s pressure, NATO allies had declined to contribute military forces to the war, outside of defensive manoeuvres.
Leavitt’s comments came shortly before Trump met with NATO Secretary-General Mark Rutte at the White House.
“I have a direct quote from the president of the United States on NATO, and I will share it with all of you. They were tested, and they failed,” Leavitt said.
“I would add, it’s quite sad that NATO turned their backs on the American people over the course of the last six weeks, when it’s the American people who have been funding their defence.”
Trump, she continued, was preparing to have “a very frank and candid conversation” with Rutte that afternoon.
In an interview with the news outlet CNN after their meeting, Rutte likewise described the encounter as “frank and open”. He reiterated his support for Trump, but added that NATO allies had offered support through logistics and access to bases.
“Did the president say he was going to try withdraw from NATO or, at the very least, not support NATO as much as other presidents have,” CNN host Jake Tapper asked Rutte.
“There is a disappointment, clearly. But at the same time he was also listening careful to my arguments of what is happening,” Rutte replied, before pivoting to praise of Trump’s leadership.
The US president has had a mixed relationship with NATO, sometimes threatening to pull US support and, at other times, reassuring allies of the US’s continued commitment to the alliance.
Since returning to the presidency in 2025, Trump has renewed his pressure campaign for NATO’s European partners to step up their defence spending.
Last June, at the 2025 NATO summit, he largely succeeded. The NATO members agreed to nonbinding commitments to increase their defence budgets to 5 percent of their gross domestic product (GDP) by 2035.
But Spain sought an exemption, leading Trump to denounce the country repeatedly over the past year.
Tensions between the US and its European allies were further strained last year when Trump threatened to use military force to seize the self-governing Danish territory of Greenland, claiming that its ownership was essential for national security.
The US has eased away from those threats. But Trump has continued to assert that US ownership of Greenland is necessary, despite strong protests from the territory’s residents and European leaders.
After the US and Israel unilaterally launched a war against Iran on February 28, Trump lashed out at European countries for their lack of interest in contributing to the campaign.
Many legal scholars consider the war an act of aggression, in violation of international law.
The Wall Street Journal reported on Wednesday that the Trump administration is considering whether to close US bases or move troops out of countries such as Spain and Germany as punishment for their stance on the war.
When asked by reporters if Trump was considering leaving NATO, Leavitt said it was something the president “has discussed” and could address after his meeting with Rutte.
Trump and Rutte are considered to have a close relationship. Rutte has visited the White House multiple times during Trump’s second term, including in March, July, August and October of last year.
In the past, Rutte has warned that NATO “will not work” without US support.
Pentagon budget surge signals fast track for Lockheed’s AIM-260 missile program
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Both European and Asian markets opened slightly lower on Tuesday as investors brace for US President Donald Trump’s deadline for Iran to either agree to a deal, or have their energy infrastructure targeted by air strikes.
The deadline falls at 8 pm Eastern Time (2 am CET), giving Iran until then to accept a deal that would keep the Strait of Hormuz open to all shipping or face what Trump has called the “complete demolition” of its civilian infrastructure, including every power plant and bridge in the country.
At the time of writing, Benchmark US crude is trading at $113.5 a barrel while Brent crude, the international standard, is around $111. Both prices are up around 1%.
The Euro Stoxx 50 and the broader pan-European Stoxx 600 are both up 0.5% as well.
The UK’s FTSE 100 is flat while Germany’s DAX 30 is around 0.2% higher, and France’s CAC 40 and Italy’s FTSE MIB have risen close to 1% each.
Over in Asia, there is a mixed reaction from markets in anticipation of the deadline.
South Korea’s Kospi has jumped 0.8% while Tokyo’s Nikkei 225 is effectively trading flat.
Hong Kong’s Hang Seng is down 0.8% while the Shanghai Composite is slightly higher by 0.3%. Additionally, Australia’s ASX 200 and Taiwan’s Taiex both rose 2%.
On Easter Sunday, President Trump renewed the threat publicly for the last time before the deadline stating that “Tuesday will be Power Plant Day, and Bridge Day, all wrapped up in one, in Iran. There will be nothing like it!!!”
On Tuesday morning, US futures are all trading between 0.1% and 0.3% lower.
The moves follow a strong close on Monday as the S&P 500 rose 0.4%, coming off its first winning week in the last six. The Dow Jones Industrial Average added 165 points, or 0.4%, and the Nasdaq composite climbed 0.5%.
Monday also offered the first chance for US markets to react to a report from Friday that stated American employers hired more workers last month than economists expected.
These were encouraging signals for an economy that’s had to absorb painful leaps in costs for gasoline since the Iran war started.
The average price for a gallon of regular gasoline is nearly $4.12 across the country, according to AAA. It was below $3 a couple days before the US and Israel launched attacks to begin the war in late February.
In other trading, gold is up 0.77% at around $4,685 while silver is rose roughly 0.2% to $72.95 an ounce.
WASHINGTON — President Trump signaled Wednesday that the United States is eyeing an offramp in its war with Iran, as he also raised the possibility of a major shift in U.S. alliances, including the potential withdrawal from NATO.
Trump indicated in a social media post that Iran’s president wanted a ceasefire, and that the United States would be open to doing so, if Iran agrees to reopen the Strait of Hormuz, a vital oil shipping route that has been affected during the monthlong conflict.
“Until then, we are blasting Iran into oblivion or, as they say, back to the Stone Ages!!!” Trump wrote.
The remarks appeared to outline a possible diplomatic opening with Tehran, but hours later Iranian officials said that Trump’s claims about being close to a deal were “false and baseless” and that the waterway remained “firmly and decisively under the control” of the Islamic Republic’s forces.
“The strait will not be opened to the enemies of this nation through the ridiculous spectacle by the president of the United States,” the paramilitary Islamic Revolutionary Guard Corps wrote in a statement.
Iranian President Masoud Pezeshkian on Wednesday also wrote a public letter denouncing what he described as a “flood of distortions and manufactured narratives” about the war from the U.S., arguing that Iran is not a threat and had only defended itself against American aggression.
He called on the American people to “look beyond the machinery of disinformation” to reach their own conclusions about the war and its purpose.
“Is ‘America First’ truly among the priorities of the U.S. government today?” he wrote, echoing recent complaints from Trump’s own base about the president’s commitments to his campaign promises.
The dueling messages underscored the uncertainty about how much longer the conflict in the Middle East will last and whether the United States will be able to achieve its main goal of preventing Iran from ever producing a nuclear weapon.
Trump, who on Tuesday said he expects the U.S. will leave Iran within three weeks, was poised to address the nation Wednesday night about the war. The White House said the president’s address would formally outline the objectives of Operation Epic Fury, whose mission has at times been convoluted even as Trump administration officials maintain their explanations for waging the war have been “clear and unchanging.”
White House Press Secretary Karoline Leavitt announced Trump’s speech late Tuesday, after Trump downplayed remarks made by Defense Secretary Pete Hegseth about Iran’s lingering military capabilities.
In the lead-up to those remarks, Trump told Reuters that he was looking to pull American forces from the region “quickly” with the possibility of returning to Iran periodically for “spot hits” when necessary.
The president, who said he believed the U.S. military is close to ensuring Iran loses its ability to possess a nuclear weapon in the future, did not seem too worried about Iran having highly enriched uranium in its stockpiles.
“That’s so far underground, I don’t care about that,” he told Reuters, adding that the U.S. military will be “watching it by satellite.”
Trump, however, remained focused on having Iran reopen the Strait of Hormuz, an oil route through which a fifth of the world’s oil flows.
He said this week that he may pull American forces from the region and leave other countries to deal with the hurdles of reopening the waterway. But on Wednesday, he seemed to walk back that stance, and said a key part of the ongoing negotiations hinged on Iran ending the de facto blockade on the strait.
It remains unclear whether Israel, which began bombing Iran alongside the U.S. on Feb. 28, would agree to the same terms as Trump and stop hostilities against Iran.
Talks about the potential end of the conflict led stocks to rise Tuesday, but it remains unclear whether higher food prices could persist for months or longer. It is also uncertain when U.S. gas prices — which jumped past an average of $4 a gallon this week for the time since 2022 — would go lower.
As Trump considers pulling out of Iran, he is also weighing a withdrawal from NATO, telling Reuters that fellow member states’ lack of support during the war has him “absolutely” considering withdrawing from the security alliance, which was ratified by the Senate in 1949.
In an interview with Fox News on Tuesday night, Secretary of State Marco Rubio said the U.S. is planning to “reexamine” its relationship with the North Atlantic Treaty Organization and whether it makes sense to be part of a “one-way-street” alliance.
“Why are we in NATO?” Rubio said. “Why do we send trillions of dollars and have all of these Americans stationed in the region, if in our time of need, we are not going to be allowed to use those bases?”
Rubio’s comment marks a notable evolution from his position in Congress. As senator in 2023, Rubio helped spearhead legislation that said the president “shall not suspend, terminate, denounce, or withdraw the United States” from NATO unless the Senate agrees by a two-thirds vote to do so.
On Wednesday, Rubio told CBS that he maintains Congress should play a role on whether the U.S. should withdraw from NATO. He added that he does not believe Trump “will remove us from NATO,” but he does believe the president will demand that NATO allies “do more.”
In a joint statement Wednesday, Sens. Mitch McConnell (R-Ky.) and Chris Coons (D-Del.) said that the United States will remain in the treaty and that the Senate “will continue to support the alliance for the peace and protection it provides America, Europe and the World.”
Although Trump has previously threatened to end U.S. membership in NATO, his most recent remarks have put added pressure on European allies to revisit the terms of their relationship.
In a post on X, Finnish President Alexander Stubb said he had a “constructive discussion” with Trump on Wednesday about NATO.
“Problems are there to be resolved, pragmatically,” Stubb wrote.
Their conversation came after Trump and Hegseth complained that European countries have been hesitant to help the U.S. in its war against Iran. Just this week, Italy and Spain refused to allow U.S. warplanes from landing at their military bases before flying to the Middle East.
Britain’s prime minister, Keir Starmer, defended NATO on Wednesday, saying it was the “single most effective military alliance the world has ever seen” and, more broadly, said he would not cave to pressure to join the Iran war.
“Whatever the pressure on me and others, whatever the noise, I’m going to act in the British national interest in all the decisions that I make,” Starmer told reporters. “That’s why I’ve been absolutely clear that this is not our war, and we’re not going to get dragged into it.”
As diplomatic efforts continue, the Trump administration has increased its military presence in the Middle East, with thousands of U.S. troops arriving in the region as ground operations in the war remain an option.
The U.S. military buildup in the Mideast came as fighting continued to escalate in the Persian Gulf region on Wednesday.
Iran hit an oil tanker off Qatar’s coast, prompting the evacuation of 21 crew members. In Bahrain, there were alerts for incoming missiles, while Kuwait’s state-run news agency KUNA reported that a drone hit a fuel tank at Kuwait International Airport. Meanwhile, Jordan’s military intercepted a ballistic missile and two drones fired by Iran, and an airstrike in Tehran appeared to have hit the former U.S. Embassy compound.
Additionally, Israeli strikes killed at least five people on a Beirut neighborhood. Israel invaded southern Lebanon in March after the Iran-linked militant group Hezbollah began launching missiles into northern Israel.
This article includes reporting from the Associated Press.
Mixed signals for Japan: Jobless rate eases to 2.6% despite retail and industrial contraction
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WASHINGTON — Californians may be forced to put their ballots in the mail well before election day to be certain they will be counted.
That’s the likely outcome of a Republican challenge to mail ballots that came before the Supreme Court on Monday.
The court’s six conservatives sounded ready to rule that federal law requires that ballots must be received by election day if they are to be counted as legal.
In the 19th century, Congress set a national day for federal elections on a Tuesday in early November, but it did not say how or when states would count their ballots. The Constitution leaves it to states to decide the “times, places and manners for holding elections.”
California and 13 other states count mail ballots that were cast before or on election day but arrive a few days late. And most states accept late ballots from members of the military who are stationed overseas.
By law, California counts mail ballots that arrive within seven days of election day. In 2024, more than 406,000 of these late-arriving ballots were counted in California, about 2.5% of the total.
Other Western states — Washington, Oregon, Nevada and Alaska — also count late-arriving mail ballots.
But President Trump has repeatedly claimed that voting by mail leads to fraud, and the Republican National Committee has gone to court to challenge the state laws that allow for counting the legally cast ballots of citizens which are postmarked on time but arrive late.
GOP lawyers argued that the phrase “election day” has always meant ballots must be in the hands of election officials on that day. In their questions and comments, all six conservatives agreed.
Justice Samuel A. Alito Jr. saw a real prospect of fraud. There could be “a big stash of ballots” that arrive late and “flip the outcome,” he said.
Democrats and election law experts say that the proposed new rule conflicts with more than a century of practice, because most states allowed for some people to vote by mail if they were traveling on election day. They argued that election day is like the federal tax day of April 15. While tax returns must be postmarked then, the tax returns are legal even if they arrive at the Internal Revenue Service a few days later.
The GOP filed its challenge in Mississippi, which accepts ballots that arrive up to five days after election day. A district judge rejected the claim, but a 5th Circuit Court panel with three Trump appointees ruled that ballots are illegal if they are not received by election day.
The case before the court is Watson vs. Republican National Committee.
California has been criticized for taking weeks to count all the votes, but that issue was not raised in this case.
Global currency and commodity markets stabilised slightly on Tuesday after a volatile start to the week triggered by the war involving Iran, United States and Israel. The U.S. dollar steadied against major currencies after earlier declines, following remarks from U.S. President Donald Trump that the conflict could end “very soon.”
Financial markets had been thrown into turmoil a day earlier amid fears that a prolonged war could trigger a major global energy shock. The conflict has disrupted oil and gas exports through the critical Strait of Hormuz, a vital shipping route for global energy supplies.
Although markets calmed somewhat after Trump’s comments, the broader environment remains highly uncertain as investors continue to assess the potential economic fallout from the conflict.
In Asian trading, the U.S. dollar was largely steady against other major currencies after retreating from the highs reached during Monday’s market turbulence.
The currency traded at around 157.73 yen against the Japanese yen and about $1.1632 against the euro, reflecting a stabilisation following the sharp movements seen earlier.
Meanwhile, oil prices remained elevated but declined from the dramatic peaks reached at the start of the week. Brent crude traded at roughly $93 per barrel, still significantly higher than levels before the outbreak of the war but well below Monday’s surge toward $120.
The pullback in oil prices helped ease immediate concerns about a severe energy shock, although analysts caution that volatility could continue if the conflict escalates again.
Despite the relative calm in currency markets, analysts say investors are far from convinced that the crisis is nearing resolution.
Rodrigo Catril, a currency strategist at National Australia Bank, warned that markets could continue to experience sudden shifts in sentiment as geopolitical developments unfold.
According to Catril, it remains unclear whether the Iranian leadership would be willing to pursue de-escalation, suggesting that the risk of renewed market volatility remains high.
The Islamic Revolutionary Guard Corps in Iran dismissed Trump’s suggestion that the conflict could end quickly, describing the remarks as “nonsense.”
Currencies closely linked to global economic sentiment weakened as investors remained cautious.
The Australian dollar slipped to around $0.7063, while the New Zealand dollar fell to roughly $0.5912. These currencies often decline during periods of geopolitical uncertainty or when investors shift toward safer assets.
The dollar, by contrast, has benefited from its traditional role as a safe-haven currency during times of crisis. The escalation of the conflict and disruption to energy markets prompted investors to move funds into U.S. assets, supporting the currency.
The British pound recovered from losses earlier in the week to trade around $1.3434.
Investors remain concerned that sustained high energy prices could slow global economic growth. Rising oil costs increase expenses for businesses and households, effectively acting as a tax on economic activity.
At the same time, higher energy prices could complicate monetary policy by pushing inflation upward and making it harder for central banks to lower interest rates.
Analysts at Deutsche Bank noted that a broader market sell-off in risk assets would likely require several conditions to occur simultaneously: persistently high oil prices, a shift in central bank policy expectations and clear evidence of a slowing global economy.
Strategist Henry Allen said markets are now significantly closer to those thresholds than they were just a week ago, though the full conditions for a major downturn have not yet materialised.
The market reaction to the Iran war underscores how closely global financial conditions are tied to geopolitical developments in the Middle East.
While Trump’s comments about a possible quick end to the conflict helped stabilise markets temporarily, the underlying risks remain substantial. The disruption of energy supplies through the Strait of Hormuz continues to threaten global oil flows and could trigger renewed price spikes if the conflict intensifies.
For investors, the situation presents a delicate balance. On one hand, hopes for de-escalation could stabilise energy prices and reduce pressure on financial markets. On the other, continued fighting or further disruptions to oil shipments could quickly reignite volatility across currencies, commodities and equities.
Until there is clearer evidence of either de-escalation or escalation, markets are likely to remain highly sensitive to political developments, with the dollar continuing to benefit from its role as a global safe haven.
With information from Reuters.