Dollar rises as Middle East tensions escalate

The dollar strengthened against a basket of major currencies on Monday as investors turned to safe-haven assets amid fears that Middle East tensions could escalate, Reuters reports.

According to the news agency, Tehran may attempt to block the Strait of Hormuz—the world's most critical oil shipping route. This raises economic risks associated with potential disruptions in energy supplies.

Nevertheless, experts surveyed by Reuters suggest the dollar is unlikely to sustain its growth once there's greater clarity on the US administration's tariff policies.

The greenback has declined 9% this year. Investors are growing nervous over the United States deadline on trade deals with Japan and the EU. The agreements with these trading partners remain unsigned, the news agency reports.

Investors are also awaiting the Federal Reserve's interest rate decision. Analysts anticipate the central bank will maintain borrowing costs at current levels, which is expected to exert downward pressure on the dollar.