Key facts
- The dollar strengthened against the yen and euro due to geopolitical tensions and speculation about U.S. interest rates.
- Doubts about a potential Iran peace deal and proposed Iranian restrictions on the Strait of Hormuz boosted the dollar.
- Investors are awaiting U.S. nonfarm payrolls data for guidance on the Federal Reserve's monetary policy.
- Brent crude oil prices increased amid Middle East tensions and the perceived unlikelihood of a deal to reopen the Strait of Hormuz.
- The U.S. jobs report is highly anticipated, with forecasts for July nonfarm payrolls at 80,000 and unemployment at 4.2%.
The dollar traded little changed on Friday ahead of the monthly U.S. payrolls report, but was still headed for a weekly gain against major peers as uncertainty about an Iran peace deal buoyed the U.S. currency's safe-haven appeal. The closely watched payrolls report could provide more clues on the Federal Reserve's rate path as markets are weighing the chance of a potential interest rate hike. Asian shares paused ahead of the data, with oil prices rising due to ongoing Middle East tensions. Doubts about a potential Iran peace deal and proposed Iranian restrictions on the Strait of Hormuz boosted the dollar. Brent crude futures gained 1.2% to $83.5 per barrel. Markets are awaiting U.S. nonfarm payrolls data, with forecasts for July at 80,000 jobs and an unemployment rate of 4.2%. Economists expect the July consumer price index to rise 3.4% year-on-year, with core CPI forecast to increase 2.5% annually. Producer price data and retail sales figures will also be released this week. Potential Japanese intervention to support the yen was also highlighted, alongside an emerging Iran-Oman deal on the Strait of Hormuz.