Published: 2026-07-08T14:55:21.000Z
USD Flows - Dangerous rhetoric loop?
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Iran threat to close Strait adds to the ramp up
Danger that things get out of control in current rhetoric-action one-upping, even if result makes no sense
Though FX isn't doing much, bonds and oil not appreciating the latest media reports. The pervading overarching worry is that US and Iran just get themselves caught up in a rhetoric-action escalation loop. Reuters suggests Iran TV dangles the threat to close the Strait in the event of any fresh strikes on Iran, as well as to respond twice times over. Brent now up $5 1/2 and closing back in on the next $80 figure area. Definitely adds to the risk overnight given Trump's threat to hit them even harder again.