Israeli Air Strikes on Iran Raise Strait of Hormuz Risks, Lift Safe-Haven Currencies ⋅ Crypto World Echo
The Israeli strikes on Iranian military sites have createdfresh uncertainty in global financial markets. As a result, investors areshowing signs of risk aversion. This has led to modest gains for traditionalsafe-haven currencies, including the US dollar, Japanese yen, and Swiss franc.
The attacks have also raised fears about the safety of theStrait of Hormuz. This narrow waterway is a key route for global oil shipments,with around one-fifth of the world’s crude supply passing through it. Anydisruption in this region could lead to oil price shocks and strain the globalenergy market.
Looking ahead, further escalation could trigger widereffects. Risingoil prices may add to inflationary pressures. In turn, central banks mightrevisit their monetary policies, which could affect interest rates and exchangerates.
Investors Cautious as Conflict Develops
So far, the reaction in the foreign exchange market has beenmeasured. While there has been increased volatility in major currency pairs,the overall moves remain limited. Investors appear cautious, waiting for moreclarity on the extent of the conflict.
Emerging market currencies and risk-sensitive forex pairsmay face renewed selling if risk-off sentiment continues. At the same time,commodity-linked currencies such as the Canadian and Australian dollars couldbenefit from higher energy prices.
You may find it interesting at FinanceMagnates.com: StockMarkets React to Israel’s Strike on Iran: Dow Futures Fall 600 Points.
Dollar rallies amid safe-haven rush after Israel strikes Iran https://t.co/ek4m1g1MIm
— farhad esmaeili (@farhadesmaeili4) June 13, 2025
Geopolitical Risks Could Spike Forex Volatility
Although the current forex impact is modest, the geopoliticalsituation may lead to sharper market responses. Traders and central banks areexpected to watch closely for any signals of prolonged instability and itseffect on inflation, rates, and global capital flows.
This article was written by Tareq Sikder at www.financemagnates.com.
