Dollar Surges Amid Oil Price Jump, AI Fears Weigh on Stocks
The US dollar surged to its highest level in two weeks on Monday as oil prices jumped due to conflict in the Middle East. The US dollar index, which tracks the currency against six major peers, rose almost 0.5% to 99.59, its highest since September 2.
Rising bets on a Federal Reserve rate hike supported the dollar, while warnings from frontier company CEOs about the dangers of AI weighed on stocks and boosted the dollar.
The euro fell to a one-month low of US$1.153, down more than 0.5%, while the British pound fell 0.4% to US$1.348. Brent crude prices surged 3% to US$108 a barrel due to Houthi strikes on Saudi Arabia and concerns about energy supplies.
Currency strategist Francesco Pesole said Gulf developments remain concerning, and some AI-related headlines are further weighing on equities, an environment where the dollar should remain supported.