The US dollar climbed to new highs against most major currencies as Middle East military tensions pushed oil higher and lifted Treasury yields. The euro, pound, franc, yen, and Canadian and New Zealand dollars all fell to fresh lows versus the greenback, while the Australian dollar was the lone holdout.
The dollar is moving to a new high against most of the major currencies, driven by rising oil prices and higher yields tied to increased military tension in the Middle East. The EUR/USD, GBP/USD, USD/CHF, USD/JPY, USD/CAD and NZD/USD are all trading at fresh extremes against the greenback. The AUD/USD is the only major pair not joining the move.
Oil prices are up nearly $4 on the day, approaching the $90 level. Treasury yields remain elevated, with the two-year up 3.7 basis points and the 10-year up 3.4 basis points. Rising oil and yields together are supporting the dollar's advance across the board.
President Trump said the US is currently striking Iran targets near the Strait of Hormuz and that the strikes are larger and powerful. The attacks are in retaliation for Iranian attacks, which were themselves in retaliation for earlier US strikes on Iran. The cycle of retaliation continues, keeping oil and yields — and with them the dollar — bid.
Source: Investinglive
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