Forex News: U.S. Dollar Rises As U.S. Widens Iran Sanctions

U.S. Dollar Rises As U.S. Widens Iran Sanctions

(RTTNews) - The U.S. dollar strengthened against most major currencies in the European session on Tuesday, after U.S. Treasury Secretary Scott Bessent announced a wave of new sanctions to isolate the Iranian regime and warned that countries and companies that help Iran move or hide money could face U.S. actions and potentially lose access to the U.S. dollar system.

Traders continue to dissect the consequences of the massive economic blockade launched by the U.S. against Iran as well as the threat of secondary sanctions on its "enablers." This is seen as an effort to pressure Tehran back to the negotiating table and force the reopening of the Strait of Hormuz.

Iranian Parliament Speaker Mohammad Bagher Ghalibaf brushed off the U.S. threats and mocked Donald Trump with a "Make America Hungry Again" remark. Economy Minister Ali Madanizadeh said Tehran is "fully prepared" to counter sanctions.

Investors awaited a key U.S. inflation reading as well as clearer guidance from Federal Reserve Chair Kevi Warsh on the Federal Reserve's likely path on rates for the remainder of the year.

In the European trading today, the U.S. dollar rose to 6-day highs of 1.1651 against the euro, 159.44 against the yen and 0.8043 against the Swiss franc, from early lows of 1.1671, 159.10 and 0.8021, respectively. If the greenback extends its uptrend, it is likely to find resistance around 1.14 against the euro, 1.161 against the yen and 0.82 against the franc.

Against the Canada and the New Zealand dollars, the greenback advanced to a 6-day high of 1.3867 and a 4-day high of 0.5858 from early lows of 1.3841 and 0.5936, respectively. The greenback may test resistance around 1.40 against the loonie and 0.56 against the kiwi.

The greenback edged up to 0.7143 against the Australian dollar, from an early low of 0.7160. On the upside, 0.70 is seen as the next resistance level for the greenback.

Looking ahead, Canada wholesale sales data for July, U.S. ADP weekly employment data, U.S. Redbook report, U.S. S&P/Case-Shiller home price index for June, U.S. Consumer Board's consumer confidence for August and U.S. Richmond Fed manufacturing index for August are slated for release in the New York session.

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