NEW YORK: The US dollar edged down on Tuesday as markets weighed developments in the Iran war, while the yen nudged lower in somewhat muted trade after suspected intervention by Tokyo last week sparked sharp gains.
The dollar index, which measures the US currency against six peers, was 0.07 percent lower at 98.389 after rising 0.3 percent on Monday. The euro was 0.1 percent higher at USD1.17005, while sterling was 0.2 percent higher at USD1.35576.
“It’s a bit of a stasis for the markets,” said Shaun Osborne, chief currency strategist at Scotiabank.
“Yesterday we had these headlines suggesting that maybe the ceasefire was at risk of breaking down, but I think it was not lost on the markets generally that President Trump didn’t take advantage of that to launch another wave of attacks,” he said.
US Defense Secretary Pete Hegseth said on Tuesday that the ceasefire with Iran was not over, even as the US and Iran exchanged fire in the Gulf as they wrestled for control of the Strait of Hormuz.
The US military said on Monday two US merchant ships made it through the strait, with the support of Navy guided-missile destroyers. Iran denied any crossings had taken place.
“I wonder, with this China visit coming up it may give us a period here where that’s going to be the focus … (Trump) doesn’t maybe want to rock the boat geopolitically too much ahead of that meeting,” Osborne said.
President Donald Trump said on Monday he looks forward to seeing China’s Xi Jinping later this month.
Data on Tuesday showed the US trade deficit widened in March as an artificial intelligence investment boom pulled in imports, more than offsetting an increase in exports, which were partly boosted by petroleum shipments amid the Middle East conflict.
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