The Dollar's Eight-Day Slide Reflects Investor Uncertainty Over Iran Peace Talks

The dollar index dropped to 98.06 on Wednesday, marking its eighth consecutive daily loss. The decline has lasted longer than any since December 3, when markets were pricing in at least two rate cuts from the Federal Reserve this year. The losing streak reflects growing uncertainty among investors about the trajectory of US-Iran peace talks and the economic fallout from the conflict. The Strait of Hormuz, a vital shipping lane for one-fifth of global oil and gas shipments, remains blocked, contributing to a surge in energy prices and renewed concerns about inflation and global growth. The European Central Bank is delaying rate hikes, citing the unresolved uncertainty around the conflict. Meanwhile, the euro rose 0.03% against the dollar, signaling a shift in risk appetite. The dollar’s weakness has been tempered by strong demand for US assets and the diminishing likelihood of near-term rate cuts.