NEW YORK: The dollar steadied on Friday but remained on track for a weekly loss, as markets monitored negotiations over a deal that could end the Middle East conflict.
Traders were also digesting unprecedented demand for shares in SpaceX, which raised USD75 billion in an initial public offering and jumped about 25 percent in its Nasdaq debut.
The euro was little changed at USD1.1577, hovering near a one-week high and set for a weekly gain after the European Central Bank delivered its first interest rate hike in three years on Thursday.
Leaked terms of a proposed memorandum to end the war in the Gulf outlined by Western, Pakistani and Iranian sources on Friday appeared to favour Iran, drawing criticism from US President Donald Trump, who called the reports inaccurate.
Trump’s announcement of a deal on Thursday had prompted Wall Street shares to rally, oil prices to slip, and the US dollar to fall.
Markets are pausing as they assess prospects for a peace deal and the impact of the SpaceX IPO, with investors watching whether funds will shift from equities or cash, said John Velis, FX and macro strategist at BNY.
“The hoped for good news on the ceasefire in the Middle East had a big reaction overnight and I think we came in this morning and we have the SpaceX IPO and a bunch of central bank meetings next week,” Velis said.
The US dollar was up 0.17 percent against Japan’s currency at 160.195 yen, holding near a key level that often triggers concern about intervention from Tokyo.
The pound was steady at USD1.34165. Data showing the UK economy contracted in April had little impact, with markets focused on Iran talks.
The US dollar index, which measures the greenback against a basket of six currencies, was flat at 99.707 after hitting a one-week low on Thursday.
Investors have tended to buy the safe-haven dollar when tensions in the Iran war flare, and sell it in favour of riskier assets such as stocks when peace talks appear to make progress.