Financial Planners

WHY:  Trump extended his Hormuz ultimatum claiming talks were progressing. Oil dropped 10% and equities rallied. Then Iran denied any negotiations, 3,000 US troops were deployed, and fresh attacks struck Israel, Kuwait, Bahrain and Saudi Arabia. Brent finished the week back near $113.

WHY: Brent crude surged 60% over the month. The Strait of Hormuz closed, the South Pars gas field was struck, Iraqi production collapsed from 3 million barrels a day to just 250,000, and Houthi rebels entered the conflict threatening Red Sea shipping. The IEA labelled it the greatest energy security threat in history.

WHY: The Nikkei fell 13.5%, the DAX 11.8%, the S&P 500 7.4% and the ASX 200 8.4%. Even gold, normally a crisis hedge, fell 15% from its peak as investors sold to meet margin calls. Silver dropped 26%. Only energy and commodities finished higher.

WHY: UK gilt yields breached 5% for the first time since 2008. The RBA increased to 4.10%. The ECB leaked discussions of April hikes. Markets ended the month pricing 73 basis points of Bank of England hikes and actively debating whether the Fed's next move would be up rather than down.

WHY: The US dollar rose 1% in aggregate against other currencies as investors sought safety and the US economy is less exposed to the oil shock as a net energy producer. The Australian dollar fell from above 71 US cents to 68.7 cents, squeezed between the benefit of higher commodity prices, a hawkish central bank and the drag of falling risk appetite and global demand. Directionally this is consistent with past patterns but there is a question mark now over whether the US Dollar is still the safe haven it once was.

WHY: Consumers are pulling back across Europe, the UK and Australasia. Business activity is slowing and companies are reporting cost increases of 25 to 30% that they simply cannot pass on. Bloomberg's economists now expect US inflation to hit 3.1% and have cut their growth forecast to 2.3%.