USD: BBH Highlights Data and Risk Aversion Trends
US Military Action Spurs Dollar Rally Amid Market Turmoil
Elias Haddad of Brown Brothers Harriman observes that the recent US-led strikes against Iran have triggered a classic flight to safety, sending the US Dollar higher and putting pressure on global stock markets. He points out that, aside from geopolitical tensions, the future path of the Dollar and risk assets will be shaped by upcoming US employment figures and the release of the February ISM manufacturing data later today.
Market Reaction: Risk Aversion and Asset Movements
Financial markets have shifted into risk-off mode as investors brace for the wider consequences of the US military campaign targeting Iran. The Dollar has strengthened broadly, equities worldwide are under pressure, gold prices have jumped over 4%, and Brent crude oil has surged by as much as 13%. Yields on major government bonds have also risen, as the spike in oil prices has heightened inflation expectations, overshadowing the usual safe-haven demand for bonds.
Geopolitical Uncertainty and Market Outlook
President Donald Trump announced that US military operations against Iran could continue for up to four or five weeks if needed. Prolonged conflict is likely to deepen uncertainty and make recent market trends more persistent. However, if the offensive weakens or topples the Iranian regime, risk assets could recover swiftly.
Key Data Releases to Watch
Looking beyond geopolitical developments, the trajectory for the Dollar and risk-sensitive assets will largely depend on this week’s US jobs report.
Today’s focus is on the February ISM manufacturing index, scheduled for release at 3:00pm London time (10:00am in New York). The main index is expected to come in at 51.5, down from January’s 52.6. Investors should closely monitor the Prices Paid and Employment components for indications of whether the tension between job growth and inflation is easing or intensifying.
(This report was produced with assistance from an AI tool and subsequently reviewed by an editor.)
Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.
You may also like
Ethena Pay Adds Earn+ Through Aave V4 Lending on Avalanche
DoorDash (DASH.US) Outperforms Nasdaq Amid Tech Stock Selloff! Officially Announces $17 Billion Acquisition of Instacart; Will Grocery Delivery and Retail Advertising Drive a Revaluation of Value?
The complete integration of the two major platforms may enhance their overall competitive and bargaining power in terms of delivery economics, consumer reach, and retail media monetization. Grocery retailers lacking their own delivery networks are bound to face more significant bargaining pressure, while Walmart and Target, which own Spark and Shipt, are relatively more capable of withstanding the impact.
Earnings Preview | A 121x P/E Ratio Gamble: If Palantir (PLTR.US) Guidance Is Not “Impressive Enough”, Its Stock Price May Plummet
Palantir released its Q3 earnings after the market closed on Monday. The market expects revenue of $2.18 billion, an increase of about 85%. The focus is on the raised annual guidance and the growth rate of the commercial business. With its high valuation, there is very little margin for error.
BTIG warns: US stocks have entered "uncharted territory," and gold may further decline to $3,500
The low volatility in the US stock market is actually an illusion created by extreme divergence among sectors, with the internal structure being extremely fragile. BTIG warns that the market urgently needs a panic-induced sharp correction, with the Nasdaq facing at least an 8.5% pullback and the S&P 500 potentially dropping to 7,300 points. Additionally, the semiconductor sector has already broken technical support, the AI sector may be adversely affected by election policies, and both gold and silver have already peaked; the true market bottom is still far from being reached.
Crypto prices
More
