“Oil prices soared and stocks sank after Donald Trump vowed in a televised speech to hit Iran 'extremely hard' over the coming weeks, knocking investors hopes of a near-term end to the conflict in the Middle East.”

“In Frankfurt, Germany’s Dax share index fell 1.5%, while France’s Cac 40 dropped by 1.35% and Italy’s FTSE MIB was down 1.2%.”

“Government borrowing costs were also on the rise, with the yield – or interest rate that issuers have to pay – on 10-year UK gilts rising four basis points to 4.886%. The two-year UK bond yield rose by six basis points to 4.36%.”

“Data released by the RAC on Thursday also showed that rising petrol and diesel prices jumped by a record amount in March, as rising oil prices translated to higher prices at the pumps for drivers.”

“It said the average price of a litre of unleaded petrol rose by 20p from 132.83p on 1 March to 152.83p by the end of the month. That surpasses the previous all-time biggest monthly jump of 16.6p recorded in June 2022, after Russia’s invasion of Ukraine.”

“The market movements have already been taking their toll on consumers, including in the UK, with the Bank of England having warned on Wednesday that 1.3 million more homeowners would probably see their monthly mortgage payments rise because of financial shocks from the Iran conflict.”

“The US dollar, meanwhile, gained almost 0.5% against a basket of major currencies, gaining ground as investors fled to the greenback as they sought safe haven assets. This move pushed the pound down by almost a cent to $1.321, reversing Wednesday’s gains.”