Interesting things are happening in the currency markets lately. The conflict in Iran seems to be accelerating carry trade movements in the G10, and the results are quite positive for certain players.

What catches my attention is that the carry trade betting against the yen and the Swiss franc is working wonderfully. Meanwhile, those betting in favor of the Australian dollar, the Norwegian krone, and the British pound are also seeing green numbers. There is a clear logic behind this.

On one hand, the Australian dollar and the Norwegian krone have strengthened because they are commodity-exporting countries' currencies, so they naturally benefit when there is geopolitical tension. The British pound is another interesting case: it rose because the market started to anticipate that the Bank of England might raise its interest rates.

Now, on the negative side for certain carry trades, the Swiss National Bank has been making noise about possible currency interventions, which has significantly weakened the Swiss franc. And oil, which obviously spikes with these conflicts, has hit the yen quite hard.

In summary, carry trade remains a strategy that creates opportunities when there is geopolitical volatility. Those who know where to position themselves are taking advantage of these movements. It’s a reminder that in the markets, global tensions can translate into well-calculated gains for those who understand the carry trade game.