FX.co ★ Dollar Hovers Near 2-Month Highs

The dollar index hovered around 100 on Thursday, holding near a two-month high after the US military carried out new strikes against Iran. President Donald Trump accused Tehran of stalling negotiations on an interim peace deal, bolstering demand for safe-haven assets. The prolonged conflict and the ongoing near-total closure of the Strait of Hormuz continued to disrupt energy shipments from the Persian Gulf, heightening concerns about inflationary pressures and potential central bank rate increases. At the same time, US consumer inflation accelerated in May to its fastest pace in more than three years, driven by surging energy prices, though the figure was in line with market expectations. Traders slightly scaled back their forecasts for additional Federal Reserve rate hikes this year, although a quarter-point increase in December remains fully priced in. Investors are now looking to upcoming producer inflation data and weekly jobless claims for further guidance on the Fed’s policy outlook.