The US Dollar Index remains subdued near 99.75 ahead of key inflation data and escalating Middle East risks.
The US Dollar Index (DXY) trades flat near 99.75 in early Asian trade, failing to extend its prior session gains. Investors remain cautious ahead of US consumer price index (CPI) data and ongoing geopolitical tensions in the Middle East.
The index has struggled to break above the 100.00 mark, with traders balancing safe-haven demand against inflation expectations. Iran’s refusal to negotiate with the US until January 20, 2029, and disruptions in key oil shipping routes have kept risk premiums elevated.
Higher crude prices and persistent inflation concerns support bets for a Federal Reserve rate hike, underpinning US Treasury yields. However, markets remain hesitant to take aggressive positions before fresh catalysts emerge.