Forex News: U.S. Dollar Edges Higher Amid Efforts To Revive

U.S. Dollar Edges Higher Amid Efforts To Revive U.S.-Iran Talks, Inflation Data Release

(RTTNews) - The U.S. Dollar value inched higher as investors watched the ongoing efforts to break the deadlock in the U.S.-Iran negotiations over the Strait of Hormuz reopening with cautious optimism. The soft U.S. inflation numbers lowered concerns of an immediate rate hike by the U.S. Federal Reserve.

Today, the U.S. Dollar Index DXY which measures the Greenback against a basket of other major currencies was last seen trading at 99.96, up by 0.16 (or 0.16%).

While against the Euro, the USD was trading at 1.152, up by 0.13%, against the GBP, the USD was trading at 1.349, up by 0.09%.

Against the USD, the Japanese Yen was trading at 159.410, down by 0.10%, the Swiss Franc was trading at 0.814, down by 0.42%; and the Canadian Dollar was trading at 1.394, down by 0.12%.

Against one unit of Australian Dollar, the USD was trading at 0.706, down by 0.04%.

The U.S.-Iran stalemate over the Strait of Hormuz continues leaving the crucial seaway to remain shut for shipping traffic.

After finalizing talks with Oman on managing the shipping traffic across the Strait of Hormuz, Iran demanded from the U.S. monetary compensation for war-inflicted damages, failing which it refused to reopen the strait.

Angered by this, U.S. President Donald Trump placed a counter-demand to Iran asking the nation to first compensate for the extensive loss of lives and properties in several conflicts that Iran had had with various other countries over the past five decades. Trump asserted that the U.S. representatives will make this claim in all the forthcoming talks with Iran.

The exchange of rhetoric raised concerns that the impasse could drag for an extended period of time as Iran is unlikely to agree to the U.S. demands.

Yesterday, Pakistan's Interior Minister Mohsin Naqvi arrived in Iran where he held separate meetings with the president and foreign minister of Iran.

Today, Pakistan's Foreign Ministry spokesperson Tahir Andrabi announced that his country is working to bring the U.S. and Iran back to the negotiating table and also prevent efforts from any "spoiler" to derail the peace process. However, Andrabi refrained from naming what he meant by "spoiler".

As investors await the next phase of development, today once again through Truth Social, Trump asserted that the U.S, had "total control" of the Strait of Hormuz and repeated that Iran has no money even to pay its troops.

In the U.S. today, the data from the Mortgage Bankers Association of America revealed that the Purchase Index increased to 157.90 on August 7 from 154.00 of the previous week.

Data released by the U.S. Bureau of Labor Statistics showed that the core consumer prices (which exclude food and energy) increased by 0.20% on a month-on-month basis. On an year-on-year basis, the core inflation rate eased for the second month to 2.50% in July.

On a month-on-month basis, the consumer price index edged up 0.10% in July in line with market expectations, rebounding from a 0.40% decline in June. The annual inflation rate slowed for the second consecutive month to 3.40% in July from 3.50%.

However, consumer prices still remain higher than at levels seen before the U.S.-Iran conflict began.

The Consumer Price Index decreased to 333.92 in July from 333.95 in June.

Currently, investors are betting on a 39.90% chance of a 25-basis-point interest rate-hike in the upcoming meeting of the U.S. Federal Reserve on September 15-16 while the odds on rates being held at the current level stand at 60.10%, according to the CME Group's FedWatch Tool.

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