The U.S. dollar advanced against major currencies on Thursday, reversing recent losses, following U.S. President Donald Trump's address on Iran. Trump stated that while conflict in Iran would soon end, the U.S. military would continue targeting Iranian sites for the next two to three weeks. This announcement dashed hopes for an imminent ceasefire, leading to a surge in demand for safe-haven assets like the dollar.
Carol Kong, a currency strategist at Commonwealth Bank of Australia, noted that Trump's comments failed to reassure markets, suggesting further escalation before de-escalation. The dollar index climbed to 99.925, up 0.3% from its previous level. Major currencies such as the euro ($1.1554) and sterling ($1.3254) weakened against the dollar, giving up recent gains. Risk-sensitive currencies like the Australian and New Zealand dollars also declined by roughly 0.6%. The Japanese yen traded weaker but remained above the key 160 level.
Markets will now focus on Friday's U.S. non-farm payrolls report, with economists expecting a 60,000 job increase in March. A weak jobs report could revive expectations for Federal Reserve rate cuts this year, though rising oil prices due to the Iran conflict have tempered such prospects.