According to Jin Ten data, the dollar rose to its highest level in nearly a month today, as the US strikes against Iran boosted safe-haven demand and highlighted the risks of rising oil prices. Investors are worried that rising oil prices could exacerbate inflation and prevent the Federal Reserve from cutting rates.
The USD/JPY rose by 1% at one point, following reports of Israel attacking key Iranian nuclear facilities. Lee Hardman, a senior foreign exchange strategist at Mitsubishi UFJ, stated that the rising geopolitical uncertainty and the risks of energy price shocks provide support for the dollar in the short term, and the Federal Reserve is reluctant to cut rates again.