US Dollar Steady Amid Iran War Tensions, AUD Dips Pre-RBA

In Asian trading on Tuesday, the U.S. dollar held steady amid ongoing concerns over the U.S. and Israel's war against Iran, while the Australian dollar dipped slightly in anticipation of a potential interest rate increase by the Reserve Bank of Australia later in the day.

The dollar index remained nearly unchanged at 99.913 as investors digested recent geopolitical tensions. The euro fell 0.12 percent to 1.1492, and the British pound declined 0.1 percent to 1.33, reversing some of the previous session's advances. Market sentiment soured after several U.S. allies rejected President Donald Trump's call to deploy warships for escorting oil tankers through the Strait of Hormuz, raising uncertainties about stabilizing energy exports. The conflict, which erupted in late February, has driven oil prices sharply higher, heightening fears of global inflation and prompting a reassessment of interest rate expectations worldwide. This dynamic has generally bolstered the dollar against other major currencies.

Focus now turns to the Reserve Bank of Australia's policy meeting in the Asia-Pacific session, where traders see a 78 percent probability of a 25 basis-point rate hike. The Australian...