US Dollar Index moves little due to renewed safe-haven demand

The US Dollar Index (DXY), which measures the value of the US Dollar (USD) against six major currencies, is remaining flat after three days of losses and hovering around 99.00 during the Asian hours on Wednesday. The Greenback may gain ground as safe-haven demand is renewed amid uncertainty surrounding the ceasefire agreement between the United States (US) and Iran.

Iranian media reported a halt in tanker traffic through the Strait of Hormuz following fresh Israeli strikes in Lebanon. Officials said recent developments breach the terms of the less-than-day-old ceasefire, calling it “unreasonable” to continue talks for a permanent deal with the United States.

Iranian Parliament Speaker Mohammad Bagher Ghalibaf said the US breached three key clauses of Iran’s 10-point proposal, calling further talks “unreasonable.” Meanwhile, US Vice President JD Vance signaled that the strait could begin reopening as he leads a US delegation to Islamabad for direct talks with Iran this weekend.

The Minutes from the Federal Reserve’s (Fed) March meeting, released on Wednesday, suggest the central bank remains in a wait-and-see stance, while acknowledging that risks are becoming more balanced. Policymakers broadly supported holding rates steady, with nearly all participants backing no change, and many viewing policy as already near a neutral range, implying a high bar for further tightening.

Traders will likely observe the US Consumer Price Index (CPI) report for March, due Friday. Headline inflation is expected to rise 3.3% year-over-year (YoY), up from 2.4%, driven by higher oil prices amid the Middle East conflict.