Escalating US-Iran tensions and hawkish Fed commentary lift USD demand, offsetting recent lows near 100.50.
The US Dollar Index (DXY) remains steady above 100.50 as traders assess geopolitical risks and Federal Reserve policy signals. The index, tracking the USD against a basket of currencies, recovered from a nearly one-month low hit earlier this week.
Heightened US-Iran tensions, including strikes on civilian infrastructure and retaliatory threats, have bolstered the safe-haven appeal of the dollar. Reports of Iran mobilizing proxies to disrupt Red Sea oil routes further stoked inflation concerns, supporting crude prices. Meanwhile, hawkish remarks from a Dallas Fed official revived expectations for a potential rate hike in 2026.
Market focus now shifts to upcoming remarks from US President Donald Trump, which could influence near-term USD movements.