<\/p>\n\n\n\n
The U.S. dollar strengthened on Friday, supported by mounting concerns that the ongoing war involving Iran could trigger a surge in energy-driven inflation and influence global monetary policy.<\/p>\n\n\n\n
By 05:26 ET (09:26 GMT)<\/strong>, the U.S. Dollar Index<\/strong>\u2014which measures the greenback against a basket of major currencies\u2014rose 0.4% to 100.13<\/strong>. Meanwhile, the euro slipped 0.5% to $1.1459<\/strong>, and the British pound fell 0.5% to $1.3275<\/strong> against the dollar.<\/p>\n\n\n\n The conflict between the United States, Israel, and Iran<\/strong>, now more than a week old, has shown little sign of easing. U.S. President Donald Trump<\/strong> said Washington was \u201ctotally destroying\u201d Iran\u2019s military and economic capabilities, while Tehran signaled its intention to continue resisting.<\/p>\n\n\n\n Iran\u2019s new Supreme Leader Mojtaba Khamenei<\/strong> has stated that the Strait of Hormuz<\/strong>\u2014a vital maritime route through which roughly 20% of global oil supply<\/strong> flows\u2014will remain closed.<\/p>\n\n\n\n The threat of a prolonged disruption to this critical shipping lane has triggered significant volatility in oil markets. Brent crude briefly surged close to $120 per barrel earlier this week<\/strong>, before pulling back below $90. On Friday, Brent futures were trading above $100 per barrel<\/strong>.<\/p>\n\n\n\n Higher energy prices raise the risk of global inflation<\/strong>, as oil and gas flowing through the Strait of Hormuz are essential inputs for industries ranging from transportation to fertilizers and plastics.<\/p>\n\n\n\n Such inflationary pressures could force central banks\u2014including the U.S. Federal Reserve<\/strong>\u2014to delay or reconsider potential interest rate cuts. Higher interest rates tend to attract foreign capital into dollar-denominated assets, strengthening the U.S. currency.<\/p>\n\n\n\n Investors are now closely watching the release of the U.S. Personal Consumption Expenditures (PCE) price index<\/strong> later on Friday, one of the Federal Reserve\u2019s preferred measures of inflation.<\/p>\n\n\n\n The core PCE index<\/strong>, which excludes volatile food and energy prices, is expected to rise 3.1% year-on-year in January<\/strong>, slightly above 3.0% recorded in December<\/strong>.<\/p>\n\n\n\n According to analysts at ING<\/strong>, the core PCE measure has been drifting further from the Fed\u2019s 2% inflation target<\/strong> since hitting a low of 2.6% last summer<\/strong>.<\/p>\n\n\n\n Interestingly, recent PCE data has shown stronger inflation readings than the Consumer Price Index (CPI)<\/strong> published by the Labor Department.<\/p>\n\n\n\n This difference largely stems from variations in calculation methods and weighting<\/strong>, particularly regarding housing and healthcare costs. The PCE index assigns less weight to shelter costs\u2014which have been cooling\u2014while giving greater weight to rising medical expenses<\/strong>, keeping the measure elevated relative to CPI.<\/p>\n\n\n\n With inflation indicators diverging and geopolitical risks escalating, markets remain highly sensitive to economic data that could shape expectations for future Federal Reserve policy decisions<\/strong>.<\/p>\n\n\n\n <\/p>\n","protected":false},"excerpt":{"rendered":" The U.S. dollar strengthened on Friday, supported by mounting concerns that the ongoing war involving Iran could trigger a surge in energy-driven inflation and influence global monetary policy. By 05:26 ET (09:26 GMT), the U.S. Dollar Index\u2014which measures the greenback against a basket of major currencies\u2014rose 0.4% to 100.13. Meanwhile, the euro slipped 0.5% to …<\/p>\n","protected":false},"author":9,"featured_media":101807,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[6827,49,37,36],"tags":[],"class_list":["post-124658","post","type-post","status-publish","format-standard","has-post-thumbnail","","category-daily-economic-reports","category-economic-reports","category-forex-markets","category-market-updates"],"_links":{"self":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/124658","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/users\/9"}],"replies":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/comments?post=124658"}],"version-history":[{"count":1,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/124658\/revisions"}],"predecessor-version":[{"id":124659,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/posts\/124658\/revisions\/124659"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/media\/101807"}],"wp:attachment":[{"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/media?parent=124658"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/categories?post=124658"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/noortrends.ae\/en\/wp-json\/wp\/v2\/tags?post=124658"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}Iran conflict boosts safe-haven demand<\/h3>\n\n\n\n
Inflation risks strengthen the dollar<\/h3>\n\n\n\n
PCE inflation data in focus<\/h3>\n\n\n\n
PCE running hotter than CPI<\/h3>\n\n\n\n