Forex News: U.S. Dollar Slides After Iran Reopens The Hormuz

U.S. Dollar Slides After Iran Reopens The Hormuz Strait

(RTTNews) - The U.S. Dollar value slipped a little as near-term inflationary concerns ease up after Iran announces immediate reopening of the Strait of Hormuz, dispelling crude oil supply disruption concerns.

The U.S. Dollar Index, DXY, which measures the Greenback against a basket of other major currencies was last seen trading at 98.19, up by 0.02 (or 0.02%) today.

While against the Euro, USD was trading at 1.177, up by 0.10%, against the GBP, it was trading at 1.352, up by 0.06%.

Against the USD, the Japanese Yen was trading at 158.598, up by 0.33%; the Swiss Franc was trading at 0.781, up by 0.29%; and the Canadian Dollar was trading at 1.368, up by 0.13%.

Against one unit of Australian Dollar, USD was trading at 0.717, down by 0.11%.

The U.S.-Israel versus Iran war which began on February 28 is undergoing a two-week ceasefire, set to lapse on April 22, U.S.

Delegates from the U.S. and Iran held negotiations in Pakistan, last Saturday, to formulate a framework of agreement to charter future negotiations and end the crisis altogether. However, the talks concluded without any progress.

Trump ordered U.S. naval forces to block vessels transiting from and to Iran's ports across the Strait of Hormuz.

The blockade was quickly enforced, pushing oil prices higher.

Today, Iran's Foreign Minister Seyed Abbas Araghchi stated that Iran has fully reopened the Strait of Hormuz to commercial vessels and added that the seaway will remain open throughout the remaining period of ceasefire.

This announcement was confirmed again by U.S. President Donald Trump. However, Trump stated that the blockade will remain until Iran reaches a deal with the U.S.

Trump also confirmed that the second round of negotiations between the U.S. and Iran will happen, probably by this weekend, in Pakistan.

In the Middle East, a 10-day ceasefire between Israel and Lebanon, mediated by U.S. came into effect since Thursday. Israel, however, has asserted that the Hezbollah will be disarmed from south of Litani through political diplomacy or else by military activity after the ceasefire period ends.

With supply disruption concerns disappearing for a brief period, oil prices plunged deeply, boosting stock market. As a result, inflationary pressures reduced and U.S. dollar index inched lower.

Winding up the expectations for any rate cut in the near-term, investors are betting still at a 99.50% chance that the U.S. Federal Reserve will hold interest rates at the current level in its upcoming meeting on April 28-29, according to the CME Group's FedWatch Tool.

In Canada, data from the Canadian Federation of Independent Business revealed its barometer long-term index rose to 58.5 in April, following a downwardly revised sharp fall of 55.7 in March. The short-term optimism index also recorded a modest gain, increasing by about 1 point to 55.4.

The Japanese Yen faced selling pressure against its peers as the Governor of Bank of Japan, Kazuo Ueda warned of upside inflation and downside growth risks due to a negative supply shock due to the Middle East war.

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