The dollar’s performance remained unstable on Thursday after experiencing significant losses, as investors exercise caution while assessing the viability of the fragile two-week ceasefire between the United States and Iran.
Concerns are growing about the potential collapse of the ceasefire as Israel continues its parallel conflict against Hezbollah in Lebanon. Tehran has accused both Israel and the United States of violating the agreement and stated that advancing peace talks would be “illogical.”
The Strait of Hormuz remains closed to vessels sailing without permission, and shipping companies have indicated they require more clarity before resuming traffic in the strait, resulting in a surge in oil prices.
The dollar index, which measures the performance of the U.S. currency against a basket of others, fell by 0.01 percent to 99.05. Meanwhile, the euro rose by 0.01 percent to $1.1663, and the British pound increased slightly by 0.01 percent to $1.3393.
The yen gave back some of its gains from the previous session following the announcement of the ceasefire, dipping 0.13 percent to 158.8 against the dollar.
Bank of Japan Governor Kazuo Ueda is scheduled to address the parliament on Thursday at 0415 GMT.
During the Iran conflict, the dollar has posted the largest gains compared to other currencies, largely due to the United States being a net energy exporter, making it less vulnerable to the economic impacts faced by oil-importing nations like Japan and several European countries.
The ongoing war, lasting nearly five weeks, has shaken investor confidence and caused unprecedented disruptions in global oil and gas supplies.
Analysts suggest that the fragile ceasefire grants Iran greater control over shipping through the vital strait compared to conditions prior to the outbreak of the conflict, especially after President Donald Trump backed away from his threats to attack Iranian civilian infrastructure.
U.S. personal consumption expenditure data for February is set to be released later today.
The Australian dollar decreased by 0.13 percent to $0.7033, while the New Zealand dollar grew by 0.07 percent to $0.5826.
In the cryptocurrency market, Bitcoin’s price fell by 0.61 percent to $70,944.20, whereas Ethereum dropped by 1.35 percent to $2,180.21.