The US dollar rose sharply on Thursday after two consecutive sessions of losses, following a speech by Donald Trump on Iran that undermined market expectations of a swift end to the conflict, reviving demand for safe-haven assets.

Trump pledged to launch more intense strikes on Iran over the next two to three weeks in a televised address on Wednesday evening, without providing a clear timeline for reopening the Strait of Hormuz or ending the war that has unsettled investors and disrupted markets.

The Iranian military responded by warning the United States and Israel of “more severe, widespread, and destructive attacks” in the future.

The dollar also strengthened against other safe-haven currencies such as the Swiss franc and the Japanese yen.

The dollar rose 0.6% to 0.799 against the Swiss franc, while gaining 0.5% against the Japanese yen to ¥159.57, approaching the key psychological level of ¥160 — a threshold that heightens concerns about potential intervention by Japanese authorities in the foreign exchange market.

Marc Chandler, chief market strategist at Bannockburn Global Forex in New York, said: “Over the past two days, there had been some optimism that the war would end soon, but President Trump’s speech yesterday undermined those hopes.”

He added: “He didn’t really say anything new, but he didn’t provide any signals to support optimism. This is the only fundamental factor that matters to markets right now: if you think the war will end soon, you buy risk assets; if you think it will continue, you sell risk.”

The euro fell 0.45% to $1.1536, while the British pound declined 0.63% to $1.3222, giving up part of their recent gains.

The dollar index, which measures the US currency against a basket of currencies, rose 0.46% to 100.02.

Scotiabank analysts led by Shaun Osborne said in a note to investors that the tone of Trump’s speech heightened market concerns, particularly after his comments about intensifying strikes over the next two to three weeks and the possibility of targeting Iran’s power infrastructure if no agreement is reached.

They added that the market reaction was swift, with most of the week’s gains in G10 currencies nearly erased.

In energy markets, Brent crude futures rose 7.78% to settle at $109.03 per barrel, after Trump’s speech reignited concerns over continued supply disruptions.

Markets await US jobs report

Initially, Trump’s remarks pushed US Treasury yields higher, but those gains were later pared. The yield on benchmark 10-year US Treasury notes fell by 1.6 basis points to 4.305%.

Investors are also awaiting the US nonfarm payrolls report due on Friday for signals on the strength of the economy and the likely path of Federal Reserve interest rates.

According to a Reuters poll, economists expect around 60,000 jobs to have been added in March.

Meanwhile, the Australian dollar fell 0.3% against the US dollar to $0.6904, while the euro rose 0.12% against the Swiss franc to 0.921.

The euro declined at the start of European trading on Friday against a basket of global currencies, extending its movement in negative territory for the second consecutive day against the US dollar, amid subdued trading conditions in the foreign exchange market due to the Good Friday holiday.

Demand for the US dollar as a preferred safe-haven asset resumed following US President Donald Trump’s address on developments in the Iran war, which included more aggressive remarks than markets had anticipated.

With eurozone inflation exceeding the European Central Bank’s medium-term target due to rising energy prices, expectations have increased for at least one interest rate hike this year, as markets await further key economic data from the region.

Price Overview

Euro exchange rate today: the euro fell about 0.1% against the dollar to $1.1532, down from the session opening level of $1.1538, with a session high of $1.1545.

The euro ended Thursday’s session down 0.45% against the dollar, marking its first loss in three days, following Donald Trump’s remarks on the war with Iran.

US dollar

The dollar index rose about 0.1% on Friday, holding gains for the second consecutive session, reflecting continued strength in the US currency against a basket of global currencies.

Dollar buying as a preferred safe-haven asset resumed following US President Donald Trump’s address to the nation on developments in the Iran war, during which he confirmed that the United States will continue the war with Iran in the coming weeks.

Later today, the US nonfarm payrolls report for March is due, a key indicator closely watched by the Federal Reserve in determining appropriate monetary policy tools for the world’s largest economy, providing strong signals on the path of US interest rates throughout this year.

European interest rates

European Central Bank President Christine Lagarde said last week that the bank is prepared to raise interest rates even if the expected rise in inflation is temporary.

Data released on Tuesday showed that eurozone inflation exceeded the ECB’s target, reaching 2.5% in March amid rising energy prices.

Following the data, money markets increased pricing for the probability of a 25 basis point rate hike by the European Central Bank at the April meeting from 30% to 35%.

Reuters sources indicated that the ECB is likely to begin discussions on raising interest rates at this month’s meeting.

To reassess these expectations, investors are awaiting further economic data from the eurozone on inflation, unemployment, and wages.

The Japanese yen fell in Asian trading on Friday against a basket of major and minor currencies, remaining in negative territory for the third consecutive day against the US dollar, amid subdued trading conditions in the foreign exchange market due to the Good Friday holiday.

Japan’s finance minister issued a new warning to currency traders, reaffirming the government’s readiness to act against speculation in foreign exchange markets, as volatility has increased significantly in recent periods.

With increasing signs of easing inflationary pressures on policymakers at the Bank of Japan, expectations for a Japanese interest rate hike in April have declined, as markets await further economic data from Japan.

Price Overview

Japanese yen exchange rate today: the US dollar rose 0.1% against the yen to ¥159.72, up from the session opening level of ¥159.59, after hitting a low of ¥159.43.

The yen ended Thursday’s session down 0.5% against the dollar, marking its second consecutive daily loss, following more hawkish remarks from US President Donald Trump regarding the war with Iran.

US dollar

The dollar index rose about 0.1% on Friday, holding gains for the second consecutive session, reflecting continued strength in the US currency against a basket of global currencies.

Dollar buying as a preferred safe-haven asset resumed following US President Donald Trump’s address to the nation on developments in the Iran war, during which he confirmed that the United States will continue the war with Iran in the coming weeks.

Later today, the US nonfarm payrolls report for March is due, a key indicator closely watched by the Federal Reserve in determining appropriate monetary policy tools for the world’s largest economy, and which will provide strong signals about the path of US interest rates over the course of this year.

Japanese authorities

Japan’s Finance Minister Satsuki Katayama issued a fresh warning to currency traders on Friday, reaffirming the government’s readiness to act against speculation in foreign exchange markets amid rising volatility.

Katayama said in a regular press conference: we are seeing increased speculation in both crude oil futures markets and foreign exchange markets, and volatility has risen significantly.

She added that since exchange rate volatility resulting from these developments affects people’s livelihoods and the broader economy, the government stands ready to respond comprehensively on all fronts.

Japanese interest rates

Data released this week in Japan showed a slowdown in core inflation in Tokyo during March, in the latest sign of easing inflationary pressures on policymakers at the Bank of Japan.

Following the data, markets reduced pricing for the probability of a quarter-point rate hike by the Bank of Japan at the April meeting from 25% to 15%.

To reassess these expectations, investors are awaiting further data on inflation, unemployment, and wages in Japan.

Oil prices rose sharply during Thursday’s trading, recording weekly gains after US President Donald Trump confirmed the continuation and intensification of military operations against Iran.

US crude surged to close above benchmark Brent for the first time in nearly four years, amid concerns over prolonged supply disruptions, especially as hopes of reopening the Strait of Hormuz faded.

US President Donald Trump said in a speech that he intends to intensify strikes on Iran over the next two to three weeks, reinforcing market expectations that military escalation will precede any de-escalation efforts.

In trading, Brent crude futures for June delivery rose 7.78%, or $7.87, to $109.03 per barrel, posting weekly gains of 3.52%, marking the seventh consecutive weekly increase.

US Nymex crude futures for May delivery jumped 11.41%, or $11.42, to $111.54 per barrel, after touching $111.73 earlier in the session, marking the largest price increase since 2020 and posting weekly gains of 11.94%.