The US dollar rose sharply on Thursday after two consecutive sessions of losses, following a speech by Donald Trump on Iran that undermined market expectations of a swift end to the conflict, reviving demand for safe-haven assets.

Trump pledged to launch more intense strikes on Iran over the next two to three weeks in a televised address on Wednesday evening, without providing a clear timeline for reopening the Strait of Hormuz or ending the war that has unsettled investors and disrupted markets.

The Iranian military responded by warning the United States and Israel of more severe, widespread, and destructive attacks in the future.

The dollar also strengthened against other safe-haven currencies such as the Swiss franc and the Japanese yen.

The dollar rose 0.6% to 0.799 against the Swiss franc, while gaining 0.5% against the Japanese yen to 159.57, approaching the key psychological level of 160 a threshold that heightens concerns about potential intervention by Japanese authorities in the foreign exchange market.

Marc Chandler, chief market strategist at Bannockburn Global Forex in New York, said: Over the past two days, there had been some optimism that the war would end soon, but President Trumps speech yesterday undermined those hopes.

He added: He didnt really say anything new, but he didnt provide any signals to support optimism. This is the only fundamental factor that matters to markets right now: if you think the war will end soon, you buy risk assets; if you think it will continue, you sell risk.

The euro fell 0.45% to $1.1536, while the British pound declined 0.63% to $1.3222, giving up part of their recent gains.

The dollar index, which measures the US currency against a basket of currencies, rose 0.46% to 100.02.

Scotiabank analysts led by Shaun Osborne said in a note to investors that the tone of Trumps speech heightened market concerns, particularly after his comments about intensifying strikes over the next two to three weeks and the possibility of targeting Irans power infrastructure if no agreement is reached.

They added that the market reaction was swift, with most of the weeks gains in G10 currencies nearly erased.

In energy markets, Brent crude futures rose 7.78% to settle at $109.03 per barrel, after Trumps speech reignited concerns over continued supply disruptions.

Markets await US jobs report

Initially, Trumps remarks pushed US Treasury yields higher, but those gains were later pared. The yield on benchmark 10-year US Treasury notes fell by 1.6 basis points to 4.305%.

Investors are also awaiting the US nonfarm payrolls report due on Friday for signals on the strength of the economy and the likely path of Federal Reserve interest rates.

According to a Reuters poll, economists expect around 60,000 jobs to have been added in March.

Meanwhile, the Australian dollar fell 0.3% against the US dollar to $0.6904, while the euro rose 0.12% against the Swiss franc to 0.921.