Dollar Remains Stable Amid Falling Oil Prices
The U.S. dollar index ended the day nearly unchanged as oil prices declined by about 3%, reducing inflationary pressures and limiting upward movement in the greenback. The safe-haven appeal of the dollar was supported amid rising geopolitical tensions, particularly following a Houthi missile and drone attack on Saudi Arabian oil tankers in the Red Sea. President Trump indicated he is considering a significant military response against Iran for its role in these attacks. Economic data showed mixed results: U.S. manufacturing PMI fell slightly below expectations while services PMI outperformed, suggesting resilience in parts of the economy. New home sales rose more than expected but building permits declined. The market currently prices in a 38% chance of a Federal Reserve rate hike at its upcoming meeting. In Europe, the euro weakened against the dollar as German bond yields hit a new 15-year high amid inflation concerns.
Topics: dollar geopolitical_tension iran_saudi_conflict oil_prices