Dollar Steadies Amid Middle East Tensions and Central Bank Meetings

The dollar held firm in uncertain trading on Monday as investors kept a close eye on the Israel-Iran conflict, wary of any signs that it might escalate into a larger regional issue. Both nations appear steadfast in their positions, raising the stakes for potential economic turmoil, especially if the Strait of Hormuz, a vital oil shipping channel, becomes a flashpoint.

Following a 7% surge, crude oil prices rose another 1% with the dollar stabilizing at 144.08 Japanese yen. The euro showed little movement, and the greenback stayed level against the Swiss franc. Currencies linked to risk, like the Australian and New Zealand dollars, ticked up, while Norway's krone reached new heights for 2023.

Investors are focused on upcoming central bank meetings, particularly the U.S. Federal Reserve's decision on interest rates. A dovish stance could mean further weakening of the dollar amid ongoing U.S. trade uncertainties. Analysts remain unconvinced of the dollar's upward trajectory amidst Trump's trade agenda, while the euro continues to gain ground.

(With inputs from agencies.)