The dollar reversed early gains Monday after President Donald Trump indicated the conflict with Iran was nearing completion. Trump told CBS he believes the war is "very complete," easing concerns over prolonged disruption to global energy supplies and economic growth.
The US-Israeli action against Iran had recently unsettled investors, driving a surge in oil prices and boosting demand for the dollar.
"The market is trading on hope," stated Marc Chandler, chief market strategist at Bannockburn Global Forex. He cautioned that the true implications of Trump's comments remain unclear. The euro edged up 0.1% to $1.1630, and the dollar eased against the Japanese yen. Sterling also turned higher against the dollar.
Trump's statements provided a lift to stock markets, while oil prices pared their sharp gains. Earlier, stocks, bonds, and precious metals had declined amid worries about surging oil prices contributing to global inflation and slowing economic growth.
Mojtaba Khamenei was named to succeed his father as Iran's supreme leader, indicating hardliners remain in control.
Brent crude was trading at $90.35, after earlier climbing over 25% to $119.50.
Analysts note that Asia may face the most significant impact from energy price shocks due to its reliance on Middle Eastern oil and gas. Britain and the Eurozone also show considerable exposure.
Bitcoin saw a 3% rise, reaching $68,980, though still near its early February multi-year low.