Dollar Strengthens Against Peers Amid Fears of Escalating Middle East Tensions

Dollar Rises as Trump's Iran Speech Rattles Markets

The U.S. dollar experienced a significant surge on Thursday, reversing two consecutive days of losses, following U.S. President Donald Trump's televised speech on Iran. Trump's address, which took place on Wednesday, failed to provide a concrete timeline for the resolution of the conflict, leading to a renewed demand for safe-haven assets.

The dollar gained 0.6% against the Swiss franc, reaching 0.799, and rose 0.5% against the Japanese yen, reaching 159.57. This increase brought the dollar close to the psychologically significant 160 level, which often sparks concerns among investors about potential intervention by Japanese authorities.

The market's reaction to Trump's speech was swift and decisive, with the euro falling 0.45% to $1.1536 and sterling sliding 0.63% to $1.3222. Both currencies gave up recent gains, as investors sought safer assets.

Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data

The dollar index, which measures the greenback against a basket of currencies, climbed 0.46% to 100.02. Analysts at Scotiabank noted that Trump's address added to market concerns, as he spoke of an intensification of strikes over the next two to three weeks and threatened the possibility of hitting Iran's power plants if a deal was not reached.

Brent crude futures rose 7.78% to settle at $109.03 per barrel, as Trump's address sparked fresh concerns about sustained disruption. U.S. Treasury yields initially rose following Trump's comments but later pared those gains, with the yield on benchmark U.S. 10-year notes falling 1.6 basis points to 4.305%.

Investors are now focused on Friday's U.S. non-farm payrolls report, which is expected to provide economic signals and insights into the possible path of Federal Reserve interest rates. The market is looking for a 60,000 rise in jobs for March, according to the median estimate of economists polled by Reuters.

Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline

The Australian dollar weakened 0.3% versus the greenback to $0.6904, while the euro strengthened 0.12% against the Swiss franc to 0.921. In cryptocurrencies, bitcoin fell 1.69% to $67,023.77, and ethereum declined 3.98% to $2,058.25.