Dollar Holds Steady Amid Iran Sanctions and Treasury Buybacks

The US dollar remained relatively unchanged on Tuesday as investors weighed Washington's expanded sanctions against Iran and renewed efforts to ease pressure on longer-dated Treasury yields.

The greenback had stumbled late last week after U.S. Treasury Secretary Scott Bessent said the Treasury would double the size of quarterly repurchases of longer-dated bonds, sparking concerns that a shift to a more direct strategy to mitigate the rise in borrowing costs could lead to a debasement of the dollar.

The dollar index edged down 0.01% to 98.95, with the euro up 0.07% at $1.167. Expectations for an interest rate hike by the Federal Reserve at its September meeting have also dwindled, pricing in a 38.1% chance for an increase of at least 25 basis points.