Dollar rises after attacks

Following the US attacks on strategic facilities in Iran, financial markets reacted cautiously, while the dollar rebounded in the first few hours of trading, El Financiero reports.

Analysts attribute this strengthening to investors' appetite for safe-haven assets amid rising geopolitical tensions. Although the initial response was moderate, greater volatility is expected in the event of a retaliation by Tehran, especially if energy flows in the Persian Gulf region are disrupted.

The US dollar traded higher against the euro, the Swiss franc, and most other major currencies at the opening of the week's markets in Sydney.

Traders are predicting a fall in stocks and a rise in gold and crude oil prices as the bombings fuel demand for security and anxiety over energy supplies.

"This riskier environment will drive investors toward safe haven assets," said Ahmad Assiri, market strategist at Pepperstone.

In another early sign of risk aversion, Bitcoin fell below $100,000 for the first time since May, and Ether plummeted, while cryptocurrencies posted widespread declines.

The market reaction has been generally muted since Israel's initial attack on Iran earlier this month: even after falling for the past two weeks, the S&P 500 is only 3% below its February all-time high. And a Bloomberg gauge of the dollar has risen less than 1% since the June 13 attack.

This is because investors expected the conflict to be local, without a broader impact on the global economy. However, market analysts say the measures could escalate if Iran responds to recent events with measures such as blocking the Strait of Hormuz, a key transit point for global energy.

US Dollar Offensive

Markets react to US attacks on Iran.

Strengthened dollar

The dollar strengthened in the first few hours of trading following the attacks, driven by the search for safe assets in the face of rising geopolitical tensions.

Financial refuge

Investors opted for currencies and assets considered safe havens in times of tension, such as the Swiss franc and gold, due to the risk of Iranian retaliation affecting the Persian Gulf.