Geopolitical Tensions Bolster Oil and Safe-Haven Demand

Heightened tensions in the Middle East supported an increase in oil prices and demand for safe-haven assets. Reports that the US President was set to hear military options concerning Iran fueled supply concerns for crude oil. This risk-off environment contributed to safe-haven flows into the US Dollar.

US Dollar Gains on Hawkish Fed and Risk Aversion

The US Dollar Index registered modest gains, finding support from a hawkish policy hold by the Federal Reserve and its status as a safe-haven currency. This strength was observed against several currencies, such as the Australian Dollar and British Pound, even as US GDP data came in weaker. The Canadian Dollar, however, remained firm, supported by elevated oil prices.

Central Banks and FX Interventions Influence Currencies

Global currency markets were active as Japanese authorities intervened to support the yen, which had previously weakened on softer domestic inflation data. Separately, the Euro gathered strength against the US Dollar after the European Central Bank decided to keep its interest rates unchanged. China’s central bank also guided the yuan slightly weaker through its daily reference rate.

Silver Struggles to Maintain Upward Momentum

In the precious metals market, silver traded with a positive bias but encountered difficulty sustaining its gains. The metal struggled to build on its modest intraday advance and capitalize on movements above the $75.00 level during the Asian session.