Dollar rises vs yen, Middle East conflict remains in focus
The U.S. dollar rose to a three-week high against the safe-haven yen and gained ground on the Swiss franc on Friday amid signs tension in the Middle East is easing after Iran backed continued discussions with Europe on its conflict with Israel.
Iran's Foreign Minister Abbas Araqchi said Tehran backed further talks with Germany, France, Britain and the EU and would be prepared to meet again in the near future following talks in Geneva.
Israel and Iran have been waging a week-long air battle as the Israeli government seeks to thwart Tehran's nuclear ambitions, and market participants are nervous about possible U.S. attacks on Iran, sparking a surge in the greenback.
The dollar index, which measures the U.S. currency against six peers, including the Swiss franc, the Japanese yen, and the euro, is poised to rise 0.6% this week.
On the day, however, the index remains flat after a Federal Reserve governor said rate cuts should be considered as soon as July, given recent inflation data.
The drop supported the currencies of net oil-importing economies such as the euro and the yen. The euro rose 0.3% at $1.1534, while the yen fell 0.29% to 145.88 per dollar.
Sterling was flat at $1.3471, paring earlier gains after British retail sales data showed volumes recorded their sharpest drop since December 2023 last month.
Source: Reuters
