The ceasefire between the United States and Iran has ended following an attack by the Iranian Revolutionary Guard Corps in the Strait of Hormuz.
U.S. President Trump stated, “The ceasefire is over,” and the U.S. military has resumed attacks, albeit on a small scale.
In response, risk-off sentiment set in, causing crude oil prices, interest rates, and the dollar to rise.

Given that the U.S.-Iran ceasefire agreement was extremely fragile to begin with, this outcome could be described as the expected course of events.
Iran is holding the global economy hostage and taking a hardline stance.

We will likely have to operate on the assumption that the blockade of the Strait of Hormuz will be prolonged.
The Nikkei 225 will become volatile. I expect the dollar-yen exchange rate to trend higher, backed by rising U.S. interest rates.

Last week, many market participants were likely eager to know the details of the discussions at the first FOMC meeting under new Fed Chair Warsh.
However, upon reviewing the minutes, the content was quite moderate, consistent with precedent, and well-balanced.
Since the minutes took into account both hawks and doves—with the weighting almost evenly split—it remains unclear from reading them whether interest rates will be raised at the next meeting.

In Japan, Finance Minister Katayama announced that the wording of the “Basic Policy 2026” would be revised, as it was deemed to be causing yen weakness and rising long-term interest rates,
and that the government would explicitly state that it respects the Bank of Japan’s independence and has no intention of restraining interest rate hikes.

He also stated that the government would encourage the GPIF to increase its investments in Japanese financial assets, and the yen strengthened on speculation that a portion of the GPIF’s massive overseas investment portfolio—which manages vast assets—would flow back into the domestic market.

However, since changes to the GPIF’s portfolio cannot be made solely at the discretion of the Ministry of Finance, and even if the wording of the Basic Policy is revised, it does not alter the policy of expansionary fiscal spending,
the yen’s appreciation has created an opportunity to buy the USD/JPY pair on dips.

I intend to seize this opportunity and move to buy the USD/JPY pair on dips.