Gulf War Sends World Currencies in Search of Equilibrium
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The world’s currencies are in search of new equilibrium after the war against Iran dislodged business-as-usual in energy and debt markets. US Treasury Secretary Scott Bessant landed in Tokyo today to discuss persistent yen weakness. The currency — long a favorite among European traders — has come under fresh pressure following the US-Israeli war against Iran. With more than 95% of its oil imports coming from the Middle East, Japan is highly exposed to disruptions in the region.
Closer to home, the strength of Switzerland’s franc is bleeding into the economy. Long seen as a haven in stormy markets, its strength is now forcing domestic watchmakers to lay off workers as their time pieces become more expensive in foreign currencies.