Dollar climbs on renewed Middle East attacks, Hormuz closure

The U.S. dollar has strengthened against major currencies, including the yen, following renewed attacks in the Middle East and reports of a partial closure of the Strait of Hormuz. Coverage highlights safe-haven demand as the primary driver, with the dollar reaching around ¥162 in early Tokyo trading. Analysts cite inflation concerns and expectations of a potential U.S. interest rate hike as additional factors supporting the dollar’s rise.

Financial news outlets, including Reuters, CNBC, and Bloomberg, emphasize the geopolitical risks as the key catalyst, noting that ongoing U.S.-Iran talks have failed to ease tensions. The yen’s weakness is attributed to both the widening interest rate gap with the U.S. and the broader risk-off sentiment in Asian markets. FXStreet and ING Think underscore energy market volatility as a near-term dominant factor in currency movements.

Investors will monitor developments in the Strait of Hormuz, where disruptions could further tighten oil supplies and amplify safe-haven flows into the dollar. Attention will also remain on U.S.-Iran negotiations, as any escalation could prolong market uncertainty. Labor market stability in the U.S. may provide a counterbalance, but geopolitical risks currently overshadow domestic economic data.