Dollar Hits Two-Month High as Oil Prices Dip Amid Iran Conflict Diplomacy

The US dollar strengthened to its highest level in two months as investors assessed the possibility of additional interest rate hikes by major central banks. The dollar index, which tracks the US currency against six major currencies, gained 0.16 per cent to 100.71.

Expectations of tighter monetary policy, along with easing crude oil prices and diplomatic efforts surrounding the Iran conflict, shaped trading sentiment. Brent crude futures fell to $98.46 a barrel, their lowest level in two weeks, as investors assess the possibility of progress towards ending the conflict.

Michael Wan, a currency analyst at MUFG, said the moderation in oil prices was positive for markets, although uncertainty remains over how the conflict will develop.