USD/JPY Drops as Iran Claims Strike on US Base; Safe Havens Surge

Global markets are under significant pressure early Thursday following a statement from the Islamic Revolutionary Guard Corps claiming a strike on a US airbase, triggering a sharp risk-off move across asset classes. USD/JPY has fallen sharply as the Japanese yen attracts heavy safe-haven demand, while USD/CHF also declines amid the flight to safety. Gold has surged alongside yen and franc strength, reflecting the severity of the geopolitical escalation. Simultaneously, the EU announced an escalation in trade defense measures against China, adding a secondary layer of uncertainty to global risk sentiment and weighing on EUR crosses. Oil prices have spiked on fears of broader Middle East conflict, which could further complicate central bank inflation outlooks. Equity futures are pointing sharply lower, reinforcing the defensive positioning in forex markets. Near-term support for USD/JPY sits at key psychological levels, while resistance for safe-haven currencies may be tested if the situation deteriorates further. Traders should exercise extreme caution given the elevated headline risk and potential for rapid reversals.