Iran Proposal Rejected, Dollar Rises Ahead of Central Bank Week
The US dollar strengthened on Tuesday (April 28th) as markets assessed the deadlock in US-Iran talks and awaited a series of central bank decisions this week. The dollar index rose 0.3% to 98.76 at 8:35 a.m. ET, while volatility remained high as the Strait of Hormuz remained nearly closed and oil prices rose again, maintaining concerns about an energy inflation shock.
Dollar sentiment was helped by reports that President Donald Trump was dissatisfied with Iran's proposal, which offered to open Hormuz and end the conflict, but postpone discussions on the nuclear program to a later stage. For Trump, the nuclear issue has been the primary objective of US-Israeli operations since late February, making the "no nukes first" proposal inadequate. Hopes for a diplomatic resumption were also eroded after Trump canceled a negotiator's trip to Pakistan over the weekend.
In Asia, the yen remained relatively stable following the Bank of Japan's decision. The BOJ held interest rates at 0.75%, but the decision was not unanimous: three of the nine board members called for a hike. The Bank of Japan (BOJ) signaled its readiness to tighten, cutting its growth projections but raising inflation expectations, with the oil shock said to push inflation beyond its 2% target in 2026. The market now awaits the Fed, ECB, and BoE meetings; EUR/USD fell 0.3% to 1.1696 and GBP/USD weakened 0.4% to 1.3492. (Arl)*
Source: Newsmaker.id
