Dollar Holds Steady Amid Geopolitical Tensions and Central Bank Decisions

The dollar held firm in turbulent trading on Monday as investors closely watched the ongoing conflict between Israel and Iran for any hints of escalation. With both nations showing no signs of relenting, market analysts weighed the possibility of Tehran blocking the Strait of Hormuz, a crucial route for oil shipping, raising economic concerns as disruptions in the energy-rich Middle East could have broader implications.

The dollar, traditionally a safe haven in times of global unrest, was steady at 144.14 against the Japanese yen after earlier gains. Meanwhile, the euro rose slightly to $1.157, and the U.S. dollar remained stable against the Swiss franc at 0.811. However, a dollar index measuring its performance against six other currencies dipped 0.3% to 98.02.

Oil prices saw a 1% drop after a significant 7% rally on Friday following Israel's preemptive strike on Iran. Kenneth Broux of Societe Generale noted that oil markets remain jittery due to potential supply disruptions. As central banks from the U.S., Japan, the UK, and others convene for critical meetings, investors will keenly observe any decisions or insights that could influence market directions.

(With inputs from agencies.)