After rebounding on Tuesday, the US Dollar Index is currently at 99.44, just below six-week highs.
The safe-haven USD is being supported by uncertainty surrounding Iran's war and worries over the blockade of Hormuz.
The Fed meeting minutes from April could offer some diversion from geopolitics later on Wednesday.
Due to its safe-haven character, the US dollar (USD) continues to rise on Wednesday as risk appetite is restrained by the unstable Iranian situation and high oil prices. At 99.44, the US Dollar Index (DXY), which compares the value of the US dollar to a basket of major currency rivals, is trading a few ticks below six-week highs.
On Tuesday, the DXY found sellers around the 99.00 area, a previous resistance zone, and then surged once more as investors lost faith that Iran's war would conclude quickly. On Tuesday, US President Donald Trump stated that although Tehran wants an agreement to stop the crisis, which is almost in its third month, the US may need to attack Iran once again.
In the meantime, the Strait of Hormuz, a crucial route for oil and other essential goods like gas or fertilizers, is still essentially closed, driving up energy costs and raising the possibility of a world food catastrophe. Because central banks are under pressure to tighten their monetary policies in order to control inflation, which is fueling a global rush for safety, the energy shock has also caused a global bond rush.
The Federal Reserve's (Fed) April meeting minutes, which are anticipated to indicate a hawkish slant despite the committee's broad difference, will be the main focus of Wednesday's macroeconomic statistics. Three members demanded that the phrase "easing bias" be removed from the bank's statement, while one member voted for a rate cut. Nevertheless, the committee decided to keep rates on hold throughout the meeting.
The safe-haven USD is being supported by uncertainty surrounding Iran's war and worries over the blockade of Hormuz.
The Fed meeting minutes from April could offer some diversion from geopolitics later on Wednesday.
Due to its safe-haven character, the US dollar (USD) continues to rise on Wednesday as risk appetite is restrained by the unstable Iranian situation and high oil prices. At 99.44, the US Dollar Index (DXY), which compares the value of the US dollar to a basket of major currency rivals, is trading a few ticks below six-week highs.
On Tuesday, the DXY found sellers around the 99.00 area, a previous resistance zone, and then surged once more as investors lost faith that Iran's war would conclude quickly. On Tuesday, US President Donald Trump stated that although Tehran wants an agreement to stop the crisis, which is almost in its third month, the US may need to attack Iran once again.
In the meantime, the Strait of Hormuz, a crucial route for oil and other essential goods like gas or fertilizers, is still essentially closed, driving up energy costs and raising the possibility of a world food catastrophe. Because central banks are under pressure to tighten their monetary policies in order to control inflation, which is fueling a global rush for safety, the energy shock has also caused a global bond rush.
The Federal Reserve's (Fed) April meeting minutes, which are anticipated to indicate a hawkish slant despite the committee's broad difference, will be the main focus of Wednesday's macroeconomic statistics. Three members demanded that the phrase "easing bias" be removed from the bank's statement, while one member voted for a rate cut. Nevertheless, the committee decided to keep rates on hold throughout the meeting.
