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Euro stays near three-month highs as Iran sanctions wait weighs on risk
EUR/USD trades above 1.1650 while investors look ahead to US PCE inflation data and a Jackson Hole speech by Fed Chair Kevin Warsh.
The euro held close to three-month highs against the US dollar on Monday, with EUR/USD trading above 1.1650 in the European session. FXStreet said investors were moderately reluctant to take risk ahead of details of a new round of US sanctions targeting Iran.
According to FXStreet, US Treasury Secretary Scott Bessent said the US is preparing what he called the “single greatest offensive ever marshalled against an adversary,” aimed at “severing every economic lifeline” to Iran. Markets are waiting to see the scope of the measures, including whether they reach traditional Iranian allies such as Iran and China.
FXStreet also pointed to Tehran’s warning that it would stop all oil exports from Gulf countries, and that any countries collaborating with the US could face sanctions described as an “act of war.” It added that Brent crude remained subdued, with the barrel trading 1.5% below Friday’s highs.
The outlet noted that a thinner macro calendar early in the week leaves traders focused on US Personal Consumption Expenditures (PCE) prices data due Wednesday and Fed Chair Kevin Warsh’s speech at the Jackson Hole Symposium on Friday. FXStreet said investors will also be watching how the Treasury’s bond buyback plans could affect central bank monetary policy, while it links related positioning moves to a weaker dollar and higher gold and US inflation breakevens.
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