Sterling drops on Trump Iran strike comments

The British pound fell sharply on Thursday as rising geopolitical tensions in the Middle East boosted demand for the U.S. dollar and triggered a broader move away from risk-sensitive currencies.

The decline came after U.S. President Donald Trump signaled further military escalation in Iran, fuelling concerns over prolonged conflict and energy market instability, News.Az reports, citing Reuters.

The pound slipped 0.7% to $1.321, reversing gains from the previous session when markets briefly priced in hopes of de-escalation.

At the same time, the euro strengthened slightly against sterling, reflecting broader currency shifts driven by global risk sentiment.

The U.S. dollar rose around 0.5% against a basket of major currencies as investors moved toward traditional safe-haven assets amid uncertainty.

Analysts say the dollar is currently benefiting as one of the few currencies seen as stable during periods of geopolitical stress.

Trump’s comments about intensifying military operations over the coming weeks added to volatility across financial markets, contributing to rising oil prices and falling equities.

Brent crude climbed above $107 per barrel, reinforcing concerns about inflationary pressure and global economic disruption.

The pound has also been under pressure due to broader concerns about energy dependence and the UK’s exposure to rising oil prices, which could weigh on inflation and growth expectations.

Market analysts warn that continued uncertainty around the conflict could keep currency markets volatile in the short term.

News.Az 

By Aysel Mammadzada