Key facts
- The dollar index fell from a two-month high.
- Optimism for a Lebanon ceasefire increased.
- The euro and British pound rose against the dollar.
- The Japanese yen neared the 160 level against the dollar.
- US services businesses' prices paid jumped to the highest level in nearly four years.
- Bitcoin hit a four-month trough.
The dollar slipped from a two-month high on Thursday as optimism grew regarding a ceasefire in Lebanon, while markets were alert to possible intervention as the Japanese yen touched the key 160 level. Lebanese President Joseph Aoun stated a ceasefire with Israel would come into force within 24 hours of approval, though Hezbollah rejected the plan and Israel continued strikes. Iran indicated a ceasefire in Lebanon is a crucial step for broader peace talks. The euro rose 0.15% to $1.1616 ahead of a potential European Central Bank rate hike, and the British pound climbed 0.05% to $1.345. The dollar index fell 0.044% to 99.405, down from a two-month high of 99.56. Iranian attacks on Kuwait and U.S. strikes near the Strait of Hormuz complicated prospects for an end to the Iran war, boosting the safe-haven dollar. ING currency strategist Francesco Pesole noted the resilience of the U.S. economy and doubts about peace talks supported the dollar. The risk-sensitive Australian dollar fell 0.13% to $0.714. A survey showed prices paid by U.S. services businesses jumped to their highest level in nearly four years, reinforcing expectations that the Federal Reserve will hold interest rates steady well into next year. The Japanese yen reached 160.015 per dollar, after hitting the 160 mark for the first time since April 30, prompting verbal warnings. The 160 level is seen as a threshold for potential official intervention. Bank of Japan Governor Kazuo Ueda signaled a June rate hike, citing inflation risks from the energy shock. Barclays economist Naohiko Baba expects a June rate hike. Bitcoin hit a four-month low of $61,344.