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US dollar rebounds as Iran sanctions escalation boosts safe-haven demand

The US Dollar Index (DXY) returned to the 99.00 level, while EUR/USD eased below 1.1700 toward the mid-1.1600s ahead of a data-heavy day.

Reported · Written up by our desk · Major Pairs

FXStreet reports the US dollar strengthened on Tuesday, with the US Dollar Index, DXY, reclaiming 99.00 for the first time since last Wednesday’s plunge. The newsletter said the move is driven largely by safe-haven demand after US Treasury Secretary Scott Bessent laid out a sharp escalation of the Iran sanctions campaign, including a “zero leakage” enforcement approach and warnings of a major financial institution being sanctioned within days.

The risk-off tone also supported gold, which climbed to just shy of $4,650 per troy ounce on the Iran-related headlines, the source said. It weighed on growth-sensitive currencies, while crude did not follow the same pattern, with West Texas Intermediate easing toward the $85.00 per barrel area despite the geopolitical flare-up.

With a busy calendar ahead, traders are looking to Germany’s IFO business surveys and a heavy run of US releases, FXStreet said. In FX moves highlighted for the session, EUR/USD was kept below 1.1700, and USD/JPY held north of 159.00 as the yen slipped against the broader strength in the US dollar.

Latest closeGold $4,432.00 ▲1.6%|WTI crude $82.40 ▲1.4%|EUR/USD 1.157 ▲0.4%

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