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2026-05-29 11:11:29
[US-Iran Ceasefire News Weighs on Safe-Haven Demand, Dollar Likely to Close Lower This Week] 1. The US dollar traded in a narrow range against major currencies on Friday. After rising and falling back on Thursday, it has fallen about 0.25% so far this week, currently trading around 99.06, and is likely to close lower for the week. Earlier reports indicated that the US and Iran had reached a draft agreement on extending the ceasefire and restoring freedom of navigation in the Strait of Hormuz, although the agreement still requires final approval from US President Trump. 2. Four sources familiar with the matter revealed that the agreement proposes to extend the ceasefire for another 60 days and allow ships to pass through this strategic waterway, while negotiators will address more thorny issues such as Iran's nuclear program. 3. Demand for the safe-haven currency, the US dollar, has weakened due to falling oil prices. However, conflicting signals from Washington and Tehran earlier this week have kept investors cautious about the possibility of a lasting solution, thus limiting overall market activity. 4. The head of strategy for global sovereign markets at UBS Asset Management stated, "Once this crisis in Iran and the Middle East is over, we expect the US dollar to remain weak." He pointed out that the conflict has temporarily halted the dollar's decline due to safe-haven demand, but many investors remain keen to diversify their portfolios and reduce their reliance on dollar assets. 5. Regarding economic data, driven by energy prices pushed up by the Iran war, US inflation in April reached its highest level in three years, further solidifying economists' view that the Federal Reserve will keep interest rates unchanged for an extended period next year.
