Forex News: U.S. Dollar Ticks Lower As Investors Weigh Developments

U.S. Dollar Ticks Lower As Investors Weigh Developments In US-Iran Standoff

(RTTNews) - The U.S. Dollar value changed a little on Monday after Iran offered a draft proposal to the U.S. regarding an arrangement for reopening the Strait of Hormuz following the U.S. cancellation of peace talks with Iran, last Saturday.

The U.S. Dollar Index, DXY, which measures the Greenback against a basket of other major currencies was last seen trading at 98.48, down by 0.05 (or 0.05%) today.

While against the Euro, USD was trading at 1.172, down by 0.03%, against the GBP, it was trading at 1.353, down by 0.08%.

Against the USD, the Japanese Yen was trading at 159.411, down by 0.07%. According to the Cabinet Office, Japan's coincident economic index, which tracks factory output, employment, and retail sales stood at 116.30 in February, down from an upwardly revised 118.10 in January. The leading economic index was revised higher to 113.30 in February from 112.40 of the preliminary estimates.

The Swiss Franc was trading at 0.786, down by 0.19%; and the Canadian Dollar was trading at 1.363, up by 0.26%.

Against one unit of Australian Dollar, USD was trading at 0.719, down by 0.54%.

The first round of U.S.-Iran negotiations held on April 11-12 were deemed "a failure" by Trump who then ordered a naval blockade on all ships transiting to and from Iran's ports.

After extending the two-week ceasefire in the current war for an indefinite period, at the request of Pakistan, U.S. President Donald Trump consented for a second round of peace talks with Iran. Trump even named U.S. envoy Steve Witkoff and Jared Kushner as representatives to lead the U.S. team.

Last Friday, Iran's Foreign Minister Abbas Araghchi left for Pakistan.

Market sentiments received a boost as expectations of a possible end to the gulf war ran high after both nations agreed to meet.

In an unexpected move, Trump cancelled the meeting calling the trip to Pakistan a waste of time.

Trump also asserted that the U.S. has "all the cards" while Iran has none and remarked that if required, Iran should speak about its plans with the U.S. over phone.

The sudden swing of events kept investors on the hook, and as a result, they refrained from risky moves.

The Strait of Hormuz continues to remain shut, leading to a surge in oil prices.

Today, Axios reported that Iran has offered a new proposal with plans to reopen the strait in exchange for U.S. withdrawal of the naval blockade.

Iran prefers to discuss the issues related to its nuclear ambitions at a later stage. The U.S. has not yet responded officially on Iran's proposals.

With the crucial monetary policy meet of the U.S. Federal Reserve scheduled for April 28-29, markets have scaled back expectations of any rate cut.

According to the CME Group's FedWatch Tool, investors are betting at a 100.00% chance that the Fed will hold the interest rates at the current 3.50% to 3.75% range.

With other major central banks too expected to hold the rates due to inflationary concerns, market participants are awaiting the U.S. moves on Iran.

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