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US dollar rises toward 101 as Gulf tensions lift risk premium
The boost comes alongside a push in the 10-year Treasury yield toward 4.6%, while cooler US inflation data temper expectations for another July Fed move.
The US dollar strengthened on Tuesday, with the US Dollar Index (DXY) up about 0.2% toward 101.00 as higher US Treasury yields and escalating Middle East tensions supported the Greenback, according to FXStreet.
FXStreet linked the dollar’s move to market concern that firmer energy prices could keep inflation elevated, even as recent cooler US inflation figures reduced expectations for a Federal Reserve rate increase in July.
The outlet also pointed to continued US and Iran attacks, plus Yemen’s Iran-aligned Ansar Allah announcing a naval blockade against Saudi Arabia, raising worries about Gulf and Red Sea shipping and potential pressure on global energy supplies and regional infrastructure.
In major pairs, FXStreet said EUR/USD fell about 0.2% toward 1.1410 under broad dollar demand, while GBP/USD declined about 0.1% toward 1.3430 as investors awaited a UK labor market report. USD/JPY edged about 0.1% higher toward 162.50, with rising US yields weighing on the yen.
Latest closeEUR/USD 1.145 ▼0.2%|USD/JPY 162.33 ▲0.2%|GBP/USD 1.348 ▼0.5%