Financial markets are reacting with increasing nervousness to the ongoing conflict between the United States and Iran. The U.S. Treasury market in particular, with a volume of around 30 trillion dollars, is showing clear signs of strain as investors hold back and liquidity declines. Volatility has risen sharply, making it difficult at times to determine prices for government bonds. In some cases, major banks have switched off their automated trading systems and reverted to manual price setting. At the same time, sharply fluctuating oil prices and short-term political statements are contributing to additional uncertainty and abrupt market movements.
Meanwhile, the U.S. government is planning symbolic measures within the financial system. These include the introduction of coins bearing the image of President Donald Trump as well as the placement of his signature on U.S. banknotes, marking a first in history. At the same time, Trump announced that during a budget dispute he would sign an order to ensure payment for TSA security personnel after irregularities occurred in airport operations. Reports indicate that, in some cases, officers from the immigration agency ICE are taking over duties at airports while TSA staff remain unpaid, prompting political criticism.
In the Middle East, the situation continues to escalate. In addition to the Strait of Hormuz, Iran is threatening to block another strategically important waterway in the Red Sea, the Bab al-Mandab Strait. These routes are crucial for global oil transport, with around 30 percent of the world’s oil supply passing through these chokepoints. A closure could significantly drive up energy prices, with projections of up to 150 dollars per barrel, while military tensions continue to intensify through further operations in the region