US Dollar Index Falls to One-Month Low on US-Iran Ceasefire

The US Dollar Index fell to its lowest level in a month on Wednesday, dropping below 99.00, as markets reacted to a surprise two-week ceasefire agreement between the United States and Iran that eased tensions in the Middle East and reduced demand for the dollar as a safe-haven asset.

The index, which tracks the dollar against a basket of six major currencies, closed the day down about 0.8 percent at around 98.80, marking its third straight decline. The move came hours after President Donald Trump announced the temporary halt to hostilities, just before a self-imposed deadline for Iran to reopen the Strait of Hormuz, a vital shipping lane for roughly one-fifth of global oil supplies. Trump had earlier warned of severe consequences, including potential strikes on Iranian infrastructure, if the strait remained blocked. The agreement requires Iran to pause its restrictions on oil and gas shipments through the waterway, though officials on both sides emphasized that full implementation remains uncertain.

Geopolitical strains had driven up safe-haven buying of the dollar in recent weeks, bolstered by Israel's strikes in Lebanon and broader regional hostilities that halted tanker...