On Friday, Iran declared the Strait of Hormuz open and markets roared back to life in response. US equities surged deep into record territory and oil prices collapsed. It appeared that the war in the Middle East was over. It was a moment of relief for the global economy and the energy supply as since then, Iran reversed it's reopening of the crucial waterway and fired on ships attempting to pass. This was in retaliation to the United States pressing ahead with it's blockade of Iranian ports. Economic data was largely overlooked as celebrations in the US markets closed out a week of big gains. Post the opening, the EUR climbed back above 1.1800, while the GBP headed towards 1.3600. These have since retreated to 1.1730 & 1.3500 respectively. Commodity currencies were beneficiaries of this Geo-Political solution, as they have been exposed for their vulnerabilities, in the energy supply space. This enabled the AUD to look towards 0.7200, while the NZD will attempt to regain 0.5900. The energy dependence of both Australia and NZ, on global supply, must now be addressed and they must now look for some independence and domestic production.
