From Tariffs to Iran, Trump's Negotiating Style Renews Uncertainty
Global markets are increasingly skeptical of US President Donald Trump's communication style. On the Iran issue, Trump initially issued a strong threat to Iranian energy facilities, but then extended the deadline for an attack by 10 days, while saying talks with Tehran were going "very well." This change in tone did not immediately calm the market, as investors saw no certainty that the risk of conflict had truly abated.
Market participants viewed this pattern as reminiscent of Trump's approach to tariffs. The style appears similar: initial strong pressure, accompanied by threats and deadlines, followed by delays, relaxations, or changes in direction as market responses and negotiating partners evolve. Reuters reported that concerns over the consistency of US policy have even influenced trading partners' attitudes in drafting additional safeguards to their economic agreements with Washington.
In the Iranian context, the main problem lies not only in the content of Trump's statements, but also in the conflicting signals. On the one hand, the threat of attack remains. On the other, deadlines have been pushed back, and optimism about diplomacy has been re-emphasized. Meanwhile, other reports continue to indicate that negotiations have not yet produced a strong breakthrough. This situation has led investors to view each new White House statement not as a certainty, but as part of a negotiation process that could change at any time.
The impact is immediately visible in market behavior. Despite the postponement of the attack threat, oil prices remain high, and global risk sentiment has not fully recovered. Reuters reports that Brent prices are still hovering around the high end, indicating that the geopolitical risk premium has not yet been removed from the market. This means that investors are not yet fully convinced that the postponement equates to a real de-escalation.
For the market, this kind of uncertainty is often more disruptive than clear bad news. If policy direction is firm, investors can still adjust their positions. However, when statements change rapidly, deadlines shift, and political messages fluctuate between threats and optimism, volatility tends to persist longer. Therefore, Trump's current communication pattern is considered not only to complicate geopolitical reading but also to reduce the market's ability to consistently assess the direction of US policy.
Impacts to Watch Out For
1. Market volatility has the potential to remain high
The pattern of statements shifting from strong threats to delays makes it difficult for market participants to accurately interpret policy direction. This condition is evident in the persistent high level of investor caution, even though Trump has postponed the attack on Iranian energy facilities until April 6, 2026.
2. Oil prices tend to remain sensitive
The postponement of the attack has not automatically eliminated the risk premium in the energy market. Reuters reported that Brent remained around US$107.97 per barrel on Friday, indicating that the market continues to consider the risk of a prolonged war and potential supply disruptions as key factors.
3. Inflationary pressures could persist longer
As long as energy prices remain high, logistics, transportation, and production costs are at risk of continued pressure. Reuters also noted that concerns over conflict and energy surges have contributed to heightened concerns about global inflation.
4. Interest rate expectations could tighten
As energy inflation rises, central banks' room to ease policy becomes narrower. Reuters reported that the surge in oil prices due to conflict has complicated the monetary policy outlook and reduced expectations of interest rate cuts, especially as inflation risks have strengthened.
5. Technology stocks and risk assets are vulnerable to pressure
When oil rises, inflation strengthens, and yields push higher, growth sectors are typically the most sensitive. Reuters reported that the Nasdaq dropped more than 2% and entered correction territory, while technology stocks led the decline as markets responded to uncertainty surrounding the Iran conflict.
6. The credibility of US policy direction is also under scrutiny
If the pattern of "threaten first, delay later" continues, markets and trading partners could find it increasingly difficult to treat Washington's statements as final guidance. Reuters reported that the European Union even added safeguards to its trade agreement with the US due to concerns about Washington's compliance following the previous tariff episode.
7. Investors tend to remain defensive
Instead of restoring confidence, the sudden change in tone has actually made investors prefer to wait for certainty. The AP noted that the latest delay came after market volatility, reinforcing the impression that the market will continue to react cautiously to every new headline from the White House. (CP)
Source: Newsmaker.id
