The dollar index (DXY) rose 0.19% today, bolstered by safe-haven demand amid escalating tensions between the US and Iran, particularly after claims of missile strikes on a US warship in the Strait of Hormuz. The dollar also gained traction from a stronger-than-expected US factory orders report, which increased by 1.5% in March, surpassing forecasts of 0.6%. This combination of geopolitical risk and positive economic data has solidified the dollar’s position in the market.

The euro is under pressure, down 0.07%, influenced by the stronger dollar and President Trump’s tariff threats on European automobile imports. However, a surprise rise in the Eurozone’s May Sentix investor confidence index and comments from ECB officials hinting at a potential rate hike in June provide some support. Meanwhile, the yen is facing headwinds due to rising crude oil prices and higher US Treasury yields, as Japan’s economy is heavily reliant on energy imports.

Market professionals should note that the heightened geopolitical risks are likely to sustain demand for the dollar as a safe-haven asset, while also creating volatility across currency pairs and commodities. The implications for precious metals remain complex, given the interplay of safe-haven demand and recent fund liquidations in gold and silver ETFs.

Source: nasdaq.com