The American dollar showed no clear direction on Monday, as the lack of clarity on the Middle East following the failure of negotiations between Washington and Tehran did not encourage traders to take a stance before several central bank meetings.
“Over the weekend, the chaotic geopolitical situation in the Middle East has hardly changed despite investors’ hopes,” noted Monex USA.
During his visit to Russia, Iranian Foreign Minister Abbas Araghchi accused Washington on Monday of sabotaging their peace talks.
American President Donald Trump is scheduled to hold a crisis meeting on Iran on Monday, according to local media reports.
According to Axios, Iran has presented the United States with a new proposal to reopen the Strait of Hormuz and end the war, and only negotiate on the nuclear issue at a later date.
The market initially reacted optimistically to this development, causing the dollar to weaken at the beginning of the day.
However, this momentum slowed down, and by around 2:15 PM, the U.S. currency stabilized against the euro (-0.01% at $1.1723) and the British pound (-0.04% at $1.3538).
“This week is full of significant news for the markets, starting with a wave of central bank meetings,” said Kevin Ford of Convera.
The speeches and projections of these institutions will be closely watched, with the Bank of Japan (BoJ), the Federal Reserve (Fed), the European Central Bank (ECB), and the Bank of England (BoE) all expected to maintain monetary status quo.
This might also be the last meeting of this kind with Jerome Powell at the helm of the Fed.
Donald Trump’s chosen successor, Kevin Warsh, is expected to have his nomination quickly confirmed with the support of a Republican senator who had previously blocked the process due to a judicial investigation, which was dropped on Friday.
Later in the week, inflation indicators in the United States and the Eurozone will also shed light on the impact of the Middle East conflict on prices.
