Dollar gains on US involvement in Middle East conflict

The dollar edged higher on Monday as anxious investors sought safe-haven assets. Traders are awaiting Iran's response to US involvement in the Middle East conflict, Reuters reports.

The most significant moves were in oil prices, which surged to a five-month-high. Meanwhile, global stock markets declined in response to US actions, the news agency notes.

At the same time, the greenback strengthened against a basket of major currencies. The dollar index rose 0.12% and reached 99.008.

Commonwealth Bank of Australia strategists state that market participants are currently more concerned about accelerating US inflation due to Middle East tensions than about their potential negative impact on the domestic economy.

According to Reuters, the dollar has regained its safe-haven status amid renewed Middle East conflict. However, subdued capital flows into the currency suggest investors remain cautious about fully committing to the greenback.