A dangerous surge in Middle East tensions that has bolstered the US dollar as a safe haven and pushed oil prices higher is seen as a fleeting market reaction that will fail to reverse the greenback’s structural decline under the Trump administration.
The US dollar index, which measures the greenback against a basket of six currencies, has jumped more than 1 per cent since last week with Tuesday recording its biggest one-day gain in a month. That’s after the US bolstered its armed forces in the Middle East, raising concern it’s about to join Israel’s conflict against Iran.
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Cécile Lefort is a markets reporter based in the Sydney newsroom. Cécile worked in New York and Hong Kong writing about global capital markets. Email Cecile at cecile.lefort@afr.com
