Key facts
- The US dollar steadied on Friday but is set for a weekly loss amid ongoing US-Iran peace talks.
- Iran indicated that a proposed memorandum to end the conflict requires finalisation.
- The euro was little changed near a one-week high after the European Central Bank raised interest rates.
- USD/JPY hovered near 160 yen, a level that raises concerns about potential intervention from Tokyo.
- US producer prices increased more than expected in May, ahead of the Federal Reserve's upcoming meeting.
- Traders anticipate the Federal Reserve will hold rates steady but see a greater than 50% chance of a hike by year-end.
The US dollar steadied on Friday but remained on track for a weekly loss, as markets monitored negotiations over a potential deal that could end the Middle East conflict. President Donald Trump's announcement of progress toward a peace deal had previously prompted Wall Street shares to rally, oil prices to slip and the US dollar to fall.
Traders were also digesting unprecedented demand for shares in SpaceX, which raised $75 billion in an initial public offering and jumped about 20% in its Nasdaq debut. The euro was little changed at $1.15725, hovering near a one-week high and set for a weekly gain after the European Central Bank delivered its first interest rate hike in three years on Thursday.
Leaked terms of a proposed memorandum to end the war in the Gulf appeared to favor Iran, drawing criticism from U.S. President Donald Trump who called the reports inaccurate. Markets are pausing as they assess the prospects for peace and the impact of the SpaceX IPO, with investors watching whether funds will shift from equities or cash.
The US dollar index, which measures the greenback against a basket of six currencies, was flat at 99.75 after hitting a one-week low on Thursday. Data on Thursday showed U.S. producer prices increased more than expected in May, ahead of the Federal Reserve's upcoming rate-setting meeting. Traders expect the Fed to keep rates steady but see a greater than 50% chance of a hike by year-end.