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The U.S. Treasury sold $39 billion in 10-year notes at a high yield of 4.217%, signaling strong demand despite inflation data aligning with expectations. Oil prices rose as energy stocks surged, driven by geopolitical tensions in the Middle East, including Iran's threats against the U.S. and EU warnings of inflation exceeding 3%. Meanwhile, Bitcoin showed mixed movements but maintained an upward bias. The U.S. February budget deficit widened to $307.5 billion, far exceeding forecasts, adding pressure on markets. Geopolitical risks, including Trump's statements on military readiness and Iran's maximalist war-ending conditions, remain key drivers of volatility. The rise in U.S. Treasury yields supports the dollar, which could pressure other currencies like the euro and yen. Energy market fluctuations, driven by OPEC+ dynamics and IEA recommendations for strategic oil reserves, will influence commodity-linked currencies such as the Canadian and Norwegian kroner. Traders should monitor U.S.-Iran tensions and their impact on oil prices, which could ripple through global markets. For Gulf investors, the combination of higher U.S. yields and energy price swings may affect portfolio allocations between equities and safe-haven assets. The region's oil-dependent economies could face mixed outcomes from rising global oil prices. Key watchpoints include the IEA's strategic reserve release plan and potential U.S. trade policy shifts under the Trump administration.
