FX.co ★ Dollar Jumps as Peace Talks Falter

The dollar index climbed as high as 99.3 on Monday before easing back to around 98.5, as renewed efforts to restart peace talks between the US and Iran broke down, keeping markets on edge over geopolitical risks. President Trump cancelled plans to send senior envoys for a second round of negotiations, while Tehran reiterated that it would not enter talks under threats or blockade conditions. Oil prices rose again as the Middle East conflict moved into its ninth week and the Strait of Hormuz remained effectively closed, stoking inflation concerns and reinforcing expectations that central banks may keep interest rates higher for longer or even tighten policy further. The Federal Reserve is widely expected to leave its policy rate unchanged on Wednesday—potentially Jerome Powell’s final meeting as chair before Kevin Warsh is expected to assume the role in May. Investors are also positioning ahead of key policy decisions from the ECB, the Bank of England, and the Bank of Japan later this week.