"The dollar stabilised to a certain extent today after retreating in the prior session, but could remain relatively volatile as markets react to geopolitical developments in the Middle East. Treasury yields were firmer following a pullback on Monday as well."
"From a technical perspective, while oil prices have been edging up since December 2025, caution is important as risks remain, unless a sustained trend above $100 is confirmed. Meanwhile, the trend could remain bullish overall, leaving short bets at risk."
"As a result, traders could continue to monitor the developments in the Middle East and their impact on inflation expectations. Plans to put in place military escorts for oil tankers in the Strait of Hormuz could drive oil, the dollar, and yields down if they materialise."
"While the market could react to a certain extent to the ADP job data today and PPI figures tomorrow, the focus remains on the Federal Reserve's Wednesday decision, where a hold is expected. However, markets could respond to Chair Powell's comments and inflation outlook under current conditions."
The dollar stabilized following a prior retreat, though volatility persists due to Middle East geopolitical developments. Treasury yields firmed after Monday's pullback, correlating with oil price movements. Oil prices have been rising since December 2025, but sustained movement above $100 requires confirmation to establish a bullish trend. Military escorts for oil tankers in the Strait of Hormuz could suppress oil, dollar, and yields if implemented. Traders monitor Middle East developments for inflation implications. While ADP job data and PPI figures may influence markets, the Federal Reserve's Wednesday decision takes priority, with a hold anticipated. Market reaction will focus on Chair Powell's comments, inflation outlook, and Fed economic projections.
Read at London Business News | Londonlovesbusiness.com
Unable to calculate read time
Collection
[
|
...
]