Middle East Geopolitical Tensions Boost Dollar
The US dollar strengthened on Tuesday (March 3) as escalating conflicts in the Middle East triggered a rapid shift to safe-haven assets, with investors again positioning the greenback as a defensive anchor amid rising geopolitical and energy risks.
At 7:21 PM ET (00:21 GMT), the Dollar Index (DXY) rose 0.77% to 99.267, its strongest level in more than a month, extending its rally after a sharp rise in the previous session. The dollar's gains were also supported by shifting interest rate expectations: surging oil prices have again raised inflation risks and prompted markets to delay projections for a US interest rate cut.
The pressure was most pronounced in currencies of economies reliant on energy imports. The euro fell 0.8% to $1.1595—its lowest since January—while the yen weakened 0.24% to 157.72 per dollar, reflecting a combination of risk-off sentiment and sensitivity to rising energy costs.
Sterling also came under pressure, falling 0.87% to $1.3290 (its lowest since December), in line with market trends that have increased risk premiums on Europe and Japan as conflict increases the threat of energy supply disruptions and complicates central bank policy direction.
Source: Newsmaker.id
