From Investing.com: 2025-06-20 08:23:00

The US dollar is fighting to regain its safe-haven status amid the Middle East conflict, with stability of foreign investors’ holdings in Treasury bonds showing continued interest in the American currency. Rising oil prices are helping to shore up the dollar, increasing the risks of inflation accelerating in the US and the likelihood of high interest rates being maintained by the Fed due to ongoing geopolitical tensions.

Stock indices are feeling the effects of stagflation more than geopolitical tensions, as the Fed paints a stagflationary scenario with lowered GDP forecasts and raised inflation estimates for the US. President Trump’s calls for rate cuts and ongoing trade tensions are causing concern among investors, with warnings of potential market declines if conflicts continue.



Read more at Investing.com: Stagflation Fears Hit S&P 500 Harder Than Middle East Escalation