Global Markets Slump as Middle East Conflict Escalates; Oil Prices Surge 📈

Global financial markets faced a sharp downturn on Thursday following a major escalation in the conflict involving the U.S., Israel, and Iran, heightening stagflation risks. • Energy Market Impact: Brent crude futures rose 4.5% to US$ 112.19 per barrel, while U.S. crude reached US$ 97.07 (+1%). Natural gas prices spiked over 6% following retaliatory strikes on energy infrastructure in the Gulf. • Currency Volatility: The Japanese Yen wobbled near the critical 160 per dollar threshold. The U.S. Dollar remains the preferred safe-haven, with the Dollar Index up 2.5% this month as the Fed signals a cautious approach to rate cuts. • Equities Downturn: Major Asian indices saw heavy selling; Japan’s Nikkei dropped 2.5% and South Korean equities fell 1.5%. European futures are trading down by over 1%. • Monetary Policy: The Bank of Japan maintained interest rates at 0.75%. Central banks, including the ECB and Bank of England, are expected to hold rates steady today while assessing the impact of rising energy costs on global inflation and growth. • Economic Outlook: Analysts warn this escalation marks a shift from a geopolitical event to a macro-economic crisis, directly impacting the "plumbing" of the global energy system and threatening a prolonged period of low growth and high inflation.