CHF Leads, AUD & GBP Lag as Oil Surges on Strait of Hormuz Tensions

Risk-off sentiment dominated European markets as geopolitical tensions and tech sector weakness weighed heavily on risk currencies. CHF emerged as the session's top performer, benefiting from safe-haven flows, while AUD and GBP lagged. WTI crude surged 2.6% to $81.00 after Iran's IRGC reaffirmed that no oil or gas would pass through the Strait of Hormuz while US attacks continue, raising supply disruption fears. S&P 500 futures fell 0.8% and Nasdaq futures dropped 1.5% as tech selling pressure persisted into the week's final stretch. The Bank of Japan is reportedly set to keep interest rates unchanged at its July meeting according to Kyodo, providing some stability for JPY crosses. Euro area inflation was confirmed at 2.8% y/y in June, down from 3.2% prior, with core CPI easing to 2.4%. Interest rate expectations have shifted notably following this week's events. Traders should monitor oil price developments and risk sentiment heading into next week, as escalating Middle East tensions could further support safe-haven currencies like CHF and JPY at the expense of commodity-linked and risk-sensitive pairs.