The dollar found stability in early trading after recent declines, as investors closely watch a fragile two-week ceasefire between the United States and Iran. The dollar index, measuring the greenback against a basket of currencies, edged up 0.03% to 99.09. The euro fell 0.07% to $1.1654, and the yen weakened 0.06% to 158.7 per dollar. Sterling eased 0.04% to $1.3387.
The greenback had previously fallen to a one-month low following the truce announcement. However, concerns linger as Israel continues operations against Hezbollah, and Iran accuses the U.S. and Israel of violations. The Strait of Hormuz remains restricted, adding to market uncertainty.
Analysts note that renewed tensions or disruptions could lead to higher oil prices, strengthening the dollar and impacting risk assets. The U.S. has benefited from the conflict as a net energy exporter. Upcoming U.S. economic data, including personal spending and the PCE deflator, may influence the dollar's trajectory.