Forex News: U.S. Dollar Rises On Iran Peace Deal Uncertainty

U.S. Dollar Rises On Iran Peace Deal Uncertainty

(RTTNews) - The U.S. dollar strengthened against other major currencies in the European session on Thursday, as investor sentiment slashed amid uncertainty lingered on the status of Middle East peace talks.

The dollar also remained near recent highs on inflation fears and hawkish Fed bets.

While the U.S. insists negotiations are ongoing, the Islamic Republic dismissed President Trump's plan for a truce and launched more attacks on Israel and Gulf Arab countries.

Iran dismissed an American plan to pause the war, insisting that it will only occur on Tehran's own terms and timeline.

Investors were also reacting to hawkish comments by European Central Bank (ECB) member and Bundesbank President Joachim Nagel.

Nagel said that the European Central Bank may hike interest rates at its next meeting in April "if the war in the Middle East raises the specters of an inflation surge in the Eurozone".

ECB President Christine Lagarde said Wednesday that anything more than a short-lived spike in inflation could warrant an increase in interest rates. In the European trading today, the U.S. dollar rose to a 3-month high of 1.3832 against the Canadian dollar, from an early low of 1.3815. The greenback may test resistance around the 1.39 region.

Against the euro and the pound, the greenback advanced to 3-day highs of 1.1553 and 1.3348 from early lows of 1.1572 and 1.3368, respectively. If the greenback extends its uptrend, it is likely to find resistance around 1.14 against the euro and 1.32 against the pound.

Against the yen and the Swiss franc, the greenback climbed to 3-day highs of 159.54 and 0.7928 from early lows of 159.33 and 0.7913, respectively. The greenback is likely to find resistance around 160.00 against the yen and 0.76 against the franc.

Against the Australia and the New Zealand dollars, the greenback jumped to 3-day highs of 0.6932 and 0.5973 from early lows of 0.6957 and 0.5809, respectively. On the upside, 0.68 against the aussie and 0.57 against the kiwi are seen as the next resistance levels for the greenback.

Looking ahead, Canada average weekly earnings for January, U.S. weekly jobless claims and U.S. Kansas Fed composite index for March are slated for release in the New York session.

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