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2026.07.0901:54:34UTC+00Dollar Holds Steady Amid Iran Strikes

The dollar index hovered around 101 on Thursday and remained on course for weekly gains, as renewed conflict in the Middle East bolstered safe-haven demand for the currency. The US military confirmed it had conducted strikes on Iran for a second consecutive day, while Tehran threatened a large-scale retaliatory operation against US military bases across the region.

The latest hostilities drove oil prices higher, intensifying inflation concerns and strengthening expectations that interest rates may stay elevated for longer. At the same time, minutes from the Federal Reserve’s June meeting showed that only a few policymakers supported an additional rate increase, though officials voiced increasing unease about the inflation outlook. Markets are still pricing in at least one Fed rate hike by the end of 2026.

Investors are now awaiting the latest weekly jobless claims and existing home sales data for further signals on the future path of interest rates.

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