Another Major Whiplash in Financial Markets After Latest Trump Zig-Zag

March 23, 2026

(147) Late today was to have been the deadline for a massive bombing operation of Iranian oil facility sites if Iran didn’t open up the Strait of Hormuz to normal shipping traffic. The ultimatum had been made two days ago, but with just hours left before the threatened operation, President Trump suddenly pushed the threatened attack back by five days. There had been no sign of Iran complying. On the contrary, officials there countered the Trump warning with one of there own, namely heavy bombing of their own of power facilities in Israel and of ones that service U.S. military bases throughout the Middle East.

On the assumption that this week would see an enormous escalation of the war and one that would have huge implications delaying a resumption of Middle Eastern energy supplies following the end of the conflict, world financial markets in the early Monday hours saw the dollar extend its gains sharply to intraday highs of $1.3257 per pound sterling, $1.1484 per euro, $0.6911 per A$, $0.5762 per kiwi, 1516 Korean won per dollar, 0.7940 Swiss francs per dollar, 159.65 Japanese yen per dollar, 17.25 South African rand per dollar, and 1.3684 Canadian dollars per USD.

Stock markets plunged in the pacific Rim, closing down 6.5% in Korea, 3.6% in China, 3.5% in Japan and Hong Kong, and 2.5% in India and Taiwan. European share prices also sunk in early trading, as did U.S. stock futures. Ten-year sovereign debt yields soared, and of course so did oil (to over $110 on Brent and West Texas Intermediate oil to 101.67 per barrel), as did precious metal prices at first.

Seeing the damage, President Trump then zig-zagged on the timing of his threat, giving Iran five more days to act and creating a whiplash for market participants. From the intra-day lows to quotes around 11:30 GMT (07:30 EDT), the dollar fell back 1.8% against the won, 2.2% relative to the Australian dollar, 0.8% versus the euro, 0.7% against sterling and 0.6% relative to the yen. Oil and gold prices plunged 10.6% and 6.9%.

From Friday closing levels, 10-year sovereign debt yields are on balance three basis points lower in Germany, Italy and Spain, two bps lower in Switzerland the U.K., and off a basis point in the United States. Alternatively in the Pacific Rim where markets had already closed for the day, such show net increases of 16 bps in Singapore, 14 bps in New Zealand, 9 bps in Australia, 8 bps in India, and 3 bps in Japan.

U.S. stock futures currently shows rises in the four major indices from 1.5% to 2.2% and gains among the big-four Euroland exchanges that range from 1.1% in Italy to 1.7% in Germany. Bitcoin had dipped below $68,000 but now is showing a 4.1% net advance on the day to around $70,650. And compared to Friday closing levels, the dollar is currently down 0.6% versus sterling, 0.4% against the yen, and 0.3% relative to the euro and Swiss franc.

All this has occurred day with hardly any data news. The steering has been handed over to the president’s media firm, Truth Social.

February consumer price inflation in Singapore printed at 1.2% for the fourth time in five months, following a 13-month high in January.

Irish wholesale prices were below year-earlier levels for a fifteenth straight month in February, this time by 5.5%.

A 5.0% year-on-year increase in Polish retail sales last month was smaller than anticipated but still at a 2-month high.

Spain’s trade deficit of EUR 4.01 billion in January was 35% narrower than a year earlier in contrast to a 42% widening in 2025 compared to 2024.

Consumer confidence indices in Belgium, Denmark and Turkey deteriorated in March against the backdrop of the Middle Eastern war. The lowest readings in 10, 3 and 2 months were recorded, respectively.

A 5.0% year-on-year rise in January Mexican retail sales was the most in 31 months.

The February reading in the Chicago Fed National Activity Index swung back under zero to -0.11 in February after poking above that threshold for the first time in ten months in the prior month.

There have been no central bank policy reviews today.

Tags: Trump changes deadline

This entry was posted
on Monday, March 23rd, 2026 at 7:01 am and is filed under New Overnight Developments Abroad – Daily Update.
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