Dollar Rises Amid US-Iran Tensions, Rate Hike Odds Soar

The US dollar strengthened on Tuesday after renewed U.S.-Iran hostilities sent oil prices higher, fueling inflation worries and sparking a global bond selloff.

The dollar index rose 0.27% to ​99.68, with the euro down ‌0.23% at $1.1589.

Investors are buying safe-haven currencies like the U.S. dollar while selling riskier assets due to higher yields.

Fed funds futures traders now price in 68% odds of a September rate hike, up from 35%, with August's jobs and consumer price inflation data key to whether the Fed hikes next month.