The surprise attack and Israel’s declaration of war in response to Hamasattack have left more than 1,100 dead and raised concerns that a potentialbroadening of the conflict could draw in the United States and Iran.
Israeli Defence Minister Yoav Gallant on Monday ordered a “complete siege”on the Gaza Strip as the military pounded the Palestinian territory withair strikes.
The Kremlin warned there was a “high risk” of a third party entering thewar, after Washington pledged “rock solid” support for Israel and said itwas moving warships closer.
The Bank of Israel launched the sale of up to $30 billion in foreigncurrency reserves, as it sought to curb volatility in its shekel currency.
However, the shekel has since tumbled to a seven-year low against thedollar.
“The shocking attacks in Israel have sent the price of oil soaring, asinvestors assess the potential for the conflict to disrupt supply in theMiddle East, if other countries are drawn in,” said Susannah Streeter, headof money and markets at Hargreaves Lansdown.
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“With the Israeli government warning of a long and difficult war, there areconcerns that deep and incessant retaliative strikes on Gaza couldpotentially bring Iran into the conflict and have an impact on the flow ofenergy in the region.”
A decidedly risk-off mood also saw investors push into the safety of thedollar, which was up against the pound and euro, as well as the Australianand New Zealand dollars.
The yen, considered one of the safest currencies, strengthened against thegreenback, though it still remains locked around 11-month lows.
Gold meanwhile gained around one percent in value. -APP/AFP