Oil prices are removed from recent maximums
Brent crude oil fell 2.1% to $ 77.23 per barrel on Friday as the immediate fears of US military intervention in the Middle East decreased. The decline occurred after President Trump announced that he would delay any decision about Iran’s strike for at least two weeks.
Despite Friday’s retirement, oil remains on the way to a weekly gain of 4%, marking the third consecutive week of increases. The previous week he saw an increase of almost 12% as tensions between Israel and Iran intensified dramatically.
Temporary postponement can create space for diplomatic negotiations, although underlying supply concerns persist. The situation is still fluid with Israel and will exchange missile strikes throughout the conflict of a week.
Asian markets show mixed performance in all regions
The broader index of the MSCI of Asia-Pacific shares outside Japan won 0.7%, mainly driven by Hong Kong Hang Seng index, which increased 1.2%. However, the index continues to fall 0.4% during the week, which reflects ongoing uncertainty.
The southern Korean reference point exceeded an increase of 1.1%, breaking above the psychologically important level of 3,000 for the first time since the beginning of 2022. The increase followed the announcement of the newly elected president Lee Jae Jae Myung of a stimulus expense plan.
Nikkei 225 of Japan closed flat despite the fact that the inflation of the nucleus reaches a maximum of two years in May to 2.8%. Inflation data maintain pressure on the Bank of Japan (BOJ) to resume increases in interest rates, although investors do not expect actions until December.
China’s markets showed resilience with modest profits, backed by the central bank’s decision to maintain reference loans without changes as expected. Stability in Chinese monetary policy provided some tranquility to regional investors.
US futures are weakened despite vacation closure
The US Variable Income Markets were closed for June holidays, providing little address for Asian commercial sessions. However, futures contracts suggested a cautious tone, with future Nasdaq 100 and S&P 500 that decrease 0.2% during Asian hours.
The performance of moderate futures highlighted the nervousness of the investor despite the temporary respite in Iran’s military action. The markets seemed to be adopting an approach to wait and see before the resumption of the complete trade of the United States.
Central banks deliver double surprises worldwide
Several central banks took off the offices with unexpectedly folded movements during the night. The Central Bank of Norway delivered its first rate reduction since 2020, surprising to analysts who expected the rates to remain stable.
The Swiss National Bank (SNB) reduced rates to zero and did not rule out moving to a negative territory if economic conditions deteriorate even more. This marked a significant change in the position of policies as they increase global growth.
The Bank of England (BOE) maintained stable rates, but pointed out potential for greater measures. Governor Andrew Bailey indicated that the Central Bank sees the need for additional monetary support as winds against economic winds persist.
Currency markets react to changing feeling
The US dollar weakened against the main peers as Haven Segura decreased after Trump’s decision to delay military action. The euro earned 0.3% to $ 1,1527, while the LIBRA increased 0.2% to $ 1,3494.
Despite Friday’s weakness, Greenback remains ready for a weekly gain of 0.5% driven by safe flows during the height of the Middle East tensions. However, many analysts expect the recent dollar strength to fade if geopolitical risks continue to decrease.
The modest profits of the British pound occurred despite the comment of Dovish of the BOE, which suggests that merchants are focusing more on the feeling of global risk than national monetary policy. Sterling is still vulnerable to greater weakness if global tensions intensify again.
What this means for merchants
Temporary flexibility of geopolitical tensions provides a brief respite for markets, but underlying risks remain high. Merchants must prepare for continuous volatility since the situation in the Middle East remains unsolved.
The two -week timeline announced by Trump reflects its approach to other important decisions, including trade negotiations. This pattern suggests that markets can see periodic relief manifestations followed by renewed tension as the deadlines focus.
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