DXY Consolidates Below 100.00 Amid Iran Risks and US CPI Hopes

The US Dollar Index (DXY) continues to consolidate below 100.00 as bulls await the release of US CPI data amid rising tensions in the Middle East.

President Donald Trump's rejection of Iran's demand for compensation over damages caused during the war has led traders to price in a geopolitical risk premium, supporting the safe-haven US Dollar.

The ongoing standoff between the US and Iran has also kept inflation risks firmly on the table, with bets for at least one interest rate hike by the Federal Reserve remaining strong.

Investors are holding back from making aggressive directional bets until more cues about the Fed's future policy path become available.