USD Mixed as Iran-US Tensions, CPI Data, and Bank Earnings Loom
The dollar traded mixed Monday as US-Iran military clashes rattled markets ahead of CPI data and a wave of major bank earnings.
The U.S. dollar opened Monday's North American session on uneven footing, rising 0.24% against the Japanese yen while falling 0.42% against the New Zealand dollar — the session's biggest mover — as traders weighed escalating Middle East hostilities against a packed week of economic catalysts. The euro edged up 0.13% against the greenback, while sterling slipped slightly, leaving the dollar broadly mixed as geopolitical uncertainty clouded directional conviction.
The sharpest driver of risk sentiment was a dramatic breakdown of the U.S.-Iran ceasefire over the weekend. Iran launched missile and drone strikes targeting American military installations across the region, and Washington retaliated with hits on Iranian air-defense systems, radar infrastructure, and naval assets. The Strait of Hormuz — a chokepoint for a significant share of global oil exports — is now at the center of market anxiety, with commercial shipping pulling back and insurers reassessing exposure as Iran signals readiness to contest passage through the corridor.
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Equity futures reflected the unease, pointing to a lower Wall Street open with the Dow off roughly 46 points, the S&P 500 down about 34 points, and the Nasdaq futures sliding approximately 319 points. Diplomatic back-channels remain active, but analysts see limited near-term progress, keeping oil-supply risk elevated.
Against that backdrop, this week's calendar is unusually dense. U.S. CPI figures drop Tuesday morning at 8:30 a.m. ET, offering the next major read on inflation and Federal Reserve policy direction. Fed Chair Kevin Warsh is also scheduled to testify before Congress on Tuesday and Wednesday starting at 10 a.m. ET. Simultaneously, second-quarter earnings season kicks off in earnest, led by major financial institutions including JPMorgan Chase, Bank of America, Goldman Sachs, Morgan Stanley, Citigroup, and Wells Fargo. Investors will scrutinize net interest income, loan-loss provisions, and management outlooks for signals on consumer health. Later in the week, results from Johnson & Johnson, Netflix, Taiwan Semiconductor, ASML, and GE Aerospace will broaden the picture across healthcare, tech, and industrials.
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