United States Dollar Index falls to three-week low amid signs of US-Iran war de-escalation
The US Dollar (USD) extends its losing streak for the third trading day on Friday amid signs of de-escalation in the ongoing clash between the United States (US) and Iran.
  • The US Dollar Index falls for the third straight trading day, extending the decline to near the three-week low at 100.60.
  • The US signals that it is still committed to the MoU with Iran, and technical talks are still on.
  • Fed Chair Warsh unveils key members of five task forces.

The US Dollar (USD) extends its losing streak for the third trading day on Friday amid signs of de-escalation in the ongoing clash between the United States (US) and Iran.

In the Asian session, the US Dollar Index (DXY), which tracks the Greenback’s value against six major currencies, trades 0.3% lower to near 100.60, revisiting the three-week low.

US Dollar Price Today

The table below shows the percentage change of US Dollar (USD) against listed major currencies today. US Dollar was the weakest against the Japanese Yen.

USD EUR GBP JPY CAD AUD NZD CHF
USD -0.22% -0.27% -0.57% -0.19% -0.31% -0.55% -0.40%
EUR 0.22% -0.05% -0.35% 0.05% -0.12% -0.34% -0.18%
GBP 0.27% 0.05% -0.33% 0.08% -0.08% -0.28% -0.14%
JPY 0.57% 0.35% 0.33% 0.40% 0.27% 0.01% 0.17%
CAD 0.19% -0.05% -0.08% -0.40% -0.14% -0.37% -0.21%
AUD 0.31% 0.12% 0.08% -0.27% 0.14% -0.24% -0.11%
NZD 0.55% 0.34% 0.28% -0.01% 0.37% 0.24% 0.14%
CHF 0.40% 0.18% 0.14% -0.17% 0.21% 0.11% -0.14%

The heat map shows percentage changes of major currencies against each other. The base currency is picked from the left column, while the quote currency is picked from the top row. For example, if you pick the US Dollar from the left column and move along the horizontal line to the Japanese Yen, the percentage change displayed in the box will represent USD (base)/JPY (quote).

Earlier in the day, reports from the Times of Israel stated that a US official signaled that Washington is still committed to the memorandum of understanding (MoU) with Iran and technical talks are still on despite US President Donald Trump declaring that the MoU is over and the exchange of attacks between the two.

On Wednesday, US President Trump also said that Iran called for making a deal, but “I just don’t know if they’re worthy of making a deal”, CNBC reported.

Signs of US-Iran war de-escalation diminish the safe-haven appeal of the US Dollar. However, higher oil prices due to renewed energy supply disruption fears have de-anchored inflation projections, which are likely to limit the US Dollar’s downside.

Technically, higher inflation expectations discourage Federal Reserve (Fed) officials from lowering interest rates.

On the monetary policy front, Fed Chair Kevin Warsh has unveiled members of five task forces, as promised in the June policy announcement, which will be focused on communications, the balance sheet policy, improving the quality and timeliness of economic data, productivity and jobs and developing inflation frameworks.

US Dollar FAQs

The US Dollar (USD) is the official currency of the United States of America, and the ‘de facto’ currency of a significant number of other countries where it is found in circulation alongside local notes. It is the most heavily traded currency in the world, accounting for over 88% of all global foreign exchange turnover, or an average of $6.6 trillion in transactions per day, according to data from 2022. Following the second world war, the USD took over from the British Pound as the world’s reserve currency. For most of its history, the US Dollar was backed by Gold, until the Bretton Woods Agreement in 1971 when the Gold Standard went away.

The most important single factor impacting on the value of the US Dollar is monetary policy, which is shaped by the Federal Reserve (Fed). The Fed has two mandates: to achieve price stability (control inflation) and foster full employment. Its primary tool to achieve these two goals is by adjusting interest rates. When prices are rising too quickly and inflation is above the Fed’s 2% target, the Fed will raise rates, which helps the USD value. When inflation falls below 2% or the Unemployment Rate is too high, the Fed may lower interest rates, which weighs on the Greenback.

In extreme situations, the Federal Reserve can also print more Dollars and enact quantitative easing (QE). QE is the process by which the Fed substantially increases the flow of credit in a stuck financial system. It is a non-standard policy measure used when credit has dried up because banks will not lend to each other (out of the fear of counterparty default). It is a last resort when simply lowering interest rates is unlikely to achieve the necessary result. It was the Fed’s weapon of choice to combat the credit crunch that occurred during the Great Financial Crisis in 2008. It involves the Fed printing more Dollars and using them to buy US government bonds predominantly from financial institutions. QE usually leads to a weaker US Dollar.

Quantitative tightening (QT) is the reverse process whereby the Federal Reserve stops buying bonds from financial institutions and does not reinvest the principal from the bonds it holds maturing in new purchases. It is usually positive for the US Dollar.

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실시간 시세

이름 / 기호
차트
% 변동 / 가격
GBPUSD
1일 변동
+0%
0
EURUSD
1일 변동
+0%
0
USDJPY
1일 변동
+0%
0

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