The US Dollar surged across the board Thursday, pushing the Dollar Index up 0.26% to hover near the critical 100.00 mark as geopolitical tensions flared in the Middle East. The greenback gained against all major currencies after reports emerged of vessel restrictions in the Strait of Hormuz, a vital global oil chokepoint responsible for roughly one-fifth of worldwide petroleum transit.
Crude oil prices spiked 3% on supply disruption fears, while traditional safe havens Gold and Silver unexpectedly declined as the Dollar captured flight-to-safety flows instead. The developments come just ahead of Friday’s crucial Nonfarm Payrolls report, which traders are watching closely for Federal Reserve policy signals.
Currency markets are now navigating a complex risk environment where Middle East escalation could pressure oil-dependent economies while simultaneously supporting Dollar strength. The Hormuz situation adds significant uncertainty to trading conditions as the week closes.
FXnCO Insight
Traders should prepare for heightened volatility around NFP release Friday, with energy-linked currencies particularly vulnerable if Hormuz tensions persist or intensify.
Source: FXStreet