Over the weekend, the US launched airstrikes on three Iranian nuclear sites, in a surprise move dubbed Operation Midnight Hammer, escalating the Iran–Israel conflict. The action spurred fears of supply disruption through the Strait of Hormuz, driving Brent crude above $78 a barrel which is a five-month high. Equity markets dipped modestly, while defence and energy stocks climbed. Investors sought safety in bonds, gold, and the US dollar. The International Monetary Fund warned that any Iranian retaliation, particularly involving the Strait, could push oil to above $100 intensifying inflation and hampering growth. Rate cuts may be delayed, with markets bracing for prolonged volatility.