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Markets faced a challenging day as the conflict in Iran triggered significant increases in both oil prices and bond yields.
U.S. President Donald Trump (Photo by Alex Wong/Getty Images)
Key points:
- Bitcoin saw a slight recovery from earlier declines after U.S. President Donald Trump announced a 10-day extension on the pause of U.S. attacks on Iran’s energy facilities.
- This statement followed a day of market downturns on Thursday, where bitcoin dropped over 3% and the Nasdaq fell by 2.4%.
- The conflict in the Middle East has not only resulted in a significant rise in oil prices but has also prompted a growing selloff in Western bond markets.
Bitcoin reduced its earlier losses Thursday afternoon after President Trump indicated a 10-day pause on attacks against Iran’s energy infrastructure.
In a post on Truth Social, Trump stated that the pause would be extended for 10 days due to ongoing diplomatic discussions.
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"As per Iranian Government request… I am pausing the period of Energy Plant destruction by 10 Days," Trump noted, adding that the "talks are ongoing" and "they are going very well."
This announcement contributed to market stabilization after a rough Thursday, which saw bitcoin drop 3% and the Nasdaq decline by 2.4%. The tech-heavy index has now decreased by roughly 10% since reaching its yearly high in late January.
The spike in oil prices since the onset of hostilities has drawn considerable attention, but the selloff in Western bond markets is becoming increasingly concerning.
The yield on the U.S. 10-year Treasury, which was below 4% just weeks ago, surged to a high of 4.43% on Thursday before retreating to 4.41%. This sharp increase has coincided with not only the dissolution of expectations for interest rate cuts by the Federal Reserve but also significant speculation that the central bank will soon raise rates.
Similar trends in bond yields and central bank expectations are also being observed across Western Europe.
Nonetheless, Trump’s comments resulted in a rise of approximately 1% in bitcoin from its lowest points, with the cryptocurrency now trading just above $69,000. Ether (ETH), XRP (XRP), Solana (SOL), and also saw recoveries from session lows, although they remained 3%-5% lower over the previous 24 hours.
