US launches airstrikes to ‘swiftly punish’ Iran for deaths of US troops
The United States (US) has launched the ninth night of Iran strikes. Washington said that airstrikes on Sunday aimed to "punish" Iran over the first US military deaths since renewed hostilities with Tehran, Bloomberg reported.
The US reported the death of another American service member, who was killed in northern Iraq during the controlled detonation of a downed Iranian drone. US Central Command (CENTCOM) also said it has located unidentified remains in Jordan, where a separate Iranian attack left two US troops dead and one missing in action.
Air raid sirens sounded across Bahrain after Iran carried out a fresh wave of ballistic missiles and one-way attack drones targeting sites in Bahrain, Jordan, Kuwait, and Iraq.
Iran missiles targeting Jordan triggered sirens near Aqaba, with Jordan saying its forces intercepted three missiles and reported no casualties or damage. Meanwhile, Kuwait’s army stated that the attacks on the power and desalination plants caused fires and “severe damage” to “vital institutions.”
Israel said Sunday it intercepted an Iranian drone near the Israel-Syria border, with Defense Minister Israel Katz warning Tehran that it will re-engage if attacked.
The number of ships transiting the Strait of Hormuz remained low over the weekend, with just four vessels crossing on Sunday, down from eight the previous day, according to LSEG shipping data.
Risk sentiment FAQs
In the world of financial jargon the two widely used terms “risk-on” and “risk off'' refer to the level of risk that investors are willing to stomach during the period referenced. In a “risk-on” market, investors are optimistic about the future and more willing to buy risky assets. In a “risk-off” market investors start to ‘play it safe’ because they are worried about the future, and therefore buy less risky assets that are more certain of bringing a return, even if it is relatively modest.
Typically, during periods of “risk-on”, stock markets will rise, most commodities – except Gold – will also gain in value, since they benefit from a positive growth outlook. The currencies of nations that are heavy commodity exporters strengthen because of increased demand, and Cryptocurrencies rise. In a “risk-off” market, Bonds go up – especially major government Bonds – Gold shines, and safe-haven currencies such as the Japanese Yen, Swiss Franc and US Dollar all benefit.
The Australian Dollar (AUD), the Canadian Dollar (CAD), the New Zealand Dollar (NZD) and minor FX like the Ruble (RUB) and the South African Rand (ZAR), all tend to rise in markets that are “risk-on”. This is because the economies of these currencies are heavily reliant on commodity exports for growth, and commodities tend to rise in price during risk-on periods. This is because investors foresee greater demand for raw materials in the future due to heightened economic activity.
The major currencies that tend to rise during periods of “risk-off” are the US Dollar (USD), the Japanese Yen (JPY) and the Swiss Franc (CHF). The US Dollar, because it is the world’s reserve currency, and because in times of crisis investors buy US government debt, which is seen as safe because the largest economy in the world is unlikely to default. The Yen, from increased demand for Japanese government bonds, because a high proportion are held by domestic investors who are unlikely to dump them – even in a crisis. The Swiss Franc, because strict Swiss banking laws offer investors enhanced capital protection.
Author
Lallalit Srijandorn
FXStreet
Lallalit Srijandorn is a Parisian at heart. She has lived in France since 2019 and now becomes a digital entrepreneur based in Paris and Bangkok.
