Dollar firms as US-Iran tensions lift oil, hawkish Fed bets build

reuters.com [$] —

The dollar edged higher on Monday, holding near a two-month high, as rising US-Iran tensions boosted oil prices and traders anticipated a more hawkish Federal Reserve. The dollar index reached 101.15, on track for its best month since June. The euro and sterling each fell 0.1% against the dollar, while Brent crude climbed above $106 a barrel after President Donald Trump rejected a peace deal with Iran. Markets now see a 65% chance of a Fed rate hike at its late-October meeting, with energy supply risks fueling inflation concerns. The yen dropped 0.3% to 157.7 per dollar despite Japan and US reaffirming cooperation on currency concerns. The Australian dollar slipped ahead of an expected rate hike, while the offshore yuan weakened after the Trump-Xi summit produced no major breakthroughs.


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