The dollar is near a week’s peak after Trump’s comments about Iran economy

The US dollar stabilized near its highest levels in about a week during trading on Wednesday, after US President Donald Trump announced the end of the temporary memorandum of understanding with Iran, which increased demand for the US currency as a safe haven, while investors awaited the release of the minutes of the last meeting of the Federal Reserve Board.

The dollar index, which measures the performance of the US currency against a basket of 6 major currencies, stabilized at 101.17 points, remaining close to its highest levels since July 2, in a session characterized by limited fluctuations.

Trump said that the temporary memorandum of understanding signed with Iran to end the conflict between the two countries “has ended,” after the Iranian Revolutionary Guard announced that it was targeting American military sites in Bahrain and Kuwait, in response to American air strikes that came after attacks targeting oil tankers in the Strait of Hormuz.

Jane Foley, head of the foreign exchange strategy department at Rabobank, said: “The dollar had a reaction, but the market has learned to deal with Trump’s statements with some caution. These statements may be aimed at pushing the other party to the negotiating table. However, they will increase levels of anxiety in the markets.”

In energy markets, Brent crude jumped by 6.24% to $78.82 per barrel, continuing its gains for the second session in a row, supported by escalating fears of supply disruption in the Middle East.

Later today, investors are awaiting the release of the minutes of the Federal Reserve’s June meeting, the first meeting held under the chairmanship of Kevin Warsh, in search of new indicators regarding the directions of US monetary policy.

Other currency markets:

• The New Zealand dollar rose 0.26% to 0.5691 US dollars, after paring its previous gains following the Reserve Bank of New Zealand’s decision to raise interest rates by 25 basis points to 2.5%, in a move aimed at curbing inflationary pressures.
• The dollar rose against the Japanese yen by 0.24% to 162.48 yen, recording its gains for the fourth session in a row, as markets awaited possible intervention by Japanese authorities.
• The euro settled at $1.1405.
• The British pound fell 0.1% to $1.3334.