Dollar Holds Firm as Middle East Hostilities Push Oil Prices Higher
The US dollar held firm on Wednesday as renewed hostilities in the Middle East pushed oil prices higher and revived inflation concerns. The currency's safe-haven appeal has been reinforced by rising Treasury yields and growing expectations of a Federal Reserve rate hike, even as recent economic data came in below forecasts.
Oil prices rose nearly 1% on Wednesday, with Brent futures up 0.92% at $95.52 a barrel and US West Texas Intermediate (WTI) crude 0.89% firmer at $91.02, after the US launched airstrikes on Iran on Tuesday. The dollar index was at 99.67, measuring the greenback against a basket of currencies including the yen and the euro.
Economists expect this Friday's jobs report to show that employers added 56,000 jobs last month. If inflation does not cool quickly, it will be time for the US central bank to increase interest rates, according to Fed Governor Michael Barr.