📖 Your Q2 Earnings Guide: Discover the Stocks ProPicks AI Highlights to Jump Post-EarningsRead more

Forex - Dollar Hits 4-Month Highs after Iran Nuclear Deal Exit

Published 05/09/2018, 03:37 AM
© Reuters.  Dollar hits 4-month highs after Iran nuclear deal exit

Investing.com - The dollar rose to fresh four month highs against a currency basket on Wednesday, boosted by rising Treasury yields after U.S. President Donald Trump’s decision to take the U.S. out of the nuclear deal with Iran.

The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, rose 0.32% to 93.24 by 03:36 AM ET (07:36 AM GMT), the most since December 19.

The dollar was boosted as the yield on 10-year U.S. Treasury notes rose above the psychologically important 3% level to the highest level in two weeks as a rally in oil prices boosted inflation expectations.

A rise above the high of 3.035% reached on April 25 would take it to its highest since early 2014.

On Tuesday, Trump pulled the U.S. out of the international nuclear deal with Iran, raising the risk of conflict in the Middle East and a knock-on effect for global oil supplies and the global economy.

The dollar rose to four day highs against the yen, with USD/JPY climbing 0.56% to 109.73.

The dollar also gained ground against the euro, which was pressured lower by renewed concerns over political turmoil in Italy. EUR/USD was down 0.28% to 1.1831, the lowest level since December 22.

The single currency has come under pressure in recent sessions after a soft patch of economic data fueled speculation that the European Central Bank may not be able to end its asset purchasing stimulus program in September, as some investors had expected.

The pound was also lower, with GBP/USD losing 0.24% to trade at 1.3515 after plumbing a four month low of 1.3483 on Tuesday.

The pound has fallen sharply in recent weeks as investors slashed expectations for a rate hike by the Bank of England this week amid indications that the economy is weakening.

Meanwhile, the Australian dollar fell to fresh eleven month lows, with AUD/USD down 0.55% to 0.7412, while the New Zealand dollar was also lower, with NZD/USD sliding 0.2% to 0.6954, a level not seen since mid-December.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.