The U.S. dollar edged lower against major currencies Tuesday as markets reacted to President Donald Trump’s announcement delaying planned strikes on Iran’s power grid. The move followed a post on Truth Social claiming "very good and productive" talks toward ending Middle East hostilities-a claim denied by Iran.
Despite a brief risk-on rally, investors remained cautious. The conflict had already disrupted about one-fifth of global oil and LNG shipments through the Strait of Hormuz. Brent crude rebounded to $100.94 a barrel after Monday’s 10% drop.
The dollar index rose slightly to 99.35 but remains near a two-week low. Sterling dipped to $1.33925, the euro fell to $1.1593, while the Australian and New Zealand dollars retreated from recent highs.
"There is little conviction in the move," said Chris Weston of Pepperstone. "The key question is whether this delay brings a deal closer or just prolongs uncertainty."
The yen held at 158.61 per dollar as Japan’s core inflation slowed to 1.6%, below the central bank’s 2% target, complicating plans for rate hikes.