Mediators push for renewed talks between Washington and Tehran, easing safe-haven demand for USD and lifting risk appetite.
The US Dollar Index (DXY) extended losses to a third session, trading at 100.75 after dipping near a three-week low of 100.56. Efforts by Qatar and Pakistan to revive US-Iran negotiations reduced geopolitical tensions, curbing demand for the safe-haven dollar.
The index had rebounded slightly from its lows as oil prices surged nearly 10% from last week’s levels due to reduced traffic through the Strait of Hormuz. Higher energy costs weighed on currencies like the euro and yen, limiting the dollar’s decline. Earlier, Japan’s finance minister announced plans to boost domestic asset investments, strengthening the yen.
A US official stated strikes were paused deliberately to allow diplomacy to proceed, avoiding further escalation. The shift in sentiment supported mild risk appetite, pressuring the dollar.