U.S. Dollar Advances Amid Ongoing Gulf Crisis, U.S.-China Summit

(RTTNews) - The U.S. Dollar value edges higher as Middle East tensions continue in the absence of a peace deal while market focus shifts to U.S.-China summit anticipating possible announcements on Chinese intervention to defuse the U.S.-Iran conflict.

The U.S. Dollar Index, DXY, which measures the Greenback against a basket of other major currencies was last seen trading at 98.89, up by 0.43 (or 0.44%) today.

The U.S. Department of Labor's data revealed that the number of people claiming unemployment benefits increased by 12,000 from the previous week to 211,000 on the first week of May, above market expectations of 205,000.

Continuing jobless claims rose to 1,782,000 in the week ending May 2 from 1,758,000 of the previous week.

Data from the U.S. Census Bureau revealed that retail sales in the U.S. increased 0.50% month on month in April.

Against the Euro, USD was trading at 1.167, up by 0.36%.

Against the GBP, it was trading at 1.340, up by 0.91%. The Gross Domestic Product in the U.K. expanded 0.30% month on month in March, contrary to expectations of a 0.20% contraction, according to the Office for National Statistics.

Against the USD, the Japanese Yen was trading at 158.386, down by 0.34% and the Swiss Franc was trading at 0.784, down by 0.28%.

In comparison to the USD, the Canadian Dollar was trading at 1.372, down by 0.11%. Statistics Canada's data revealed that wholesale trade rose 1.90% month over month to C$89.0 billion in March, higher than forecasts of a 1.30% increase.

Against one unit of Australian Dollar, USD was trading at 0.722, up by 0.51%.

The peace talks between the U.S. and Iran to end the gulf war is in a limbo though both nations have agreed to a ceasefire since April beginning.

U.S. President Donald Trump is on a two-day visit to China where he is meeting Chinese President Xi Jinping to discuss bilateral trade ties.

Earlier, Trump had rejected Iran's response to U.S. peace proposal as "totally unacceptable".

Before leaving for China, Trump asserted that the U.S. could end the war either through diplomatic process or even otherwise, indirectly hinting at military options.

After CNN reported that Trump was planning to restart military offensive against Iran, Iran stated it was ready to face any U.S. aggression.

Today, a White House message stated that both the leaders agreed that the Strait of Hormuz should remain open to all nations and facilitate free shipping transit.

With war concerns rising, investors are now anticipating China's intervention to end the crisis. Of note, China imports nearly 90% of Iran's oil and is an ally of Iran for years.

U.S. Vice President JD Vance stated that the negotiations between the U.S. and Iran was progressing well.

In an interview with Fox News, U.S. Secretary of State Marco Rubio stated that Trump will attempt to convince Xi to take an active role in negotiations.

In an interview with CNBC, U.S. Treasury Secretary Scott Bessent stated that reopening the Strait of Hormuz is very much in China's interest, given its reliance on energy from the gulf.

In an interview with Fox News, Trump revealed that Xi would like to see a deal made and has offered "any help whatsoever" to end the Iran conflict.

On the monetary front, after passing with a 54 to 45 Senate votes Kevin Warsh stepped into the role of the U.S. Federal Reserve's Chair officially, yesterday.

With the U.S. annual inflation rising to 3.80% in April, against market expectations of 3.70%, investors are anticipating his moves with regard to interest rates.

According to the CME Group's FedWatch Tool, investors are betting at only at a 2.60% chance of a quarter-point interest rate cut in the Federal Reserve's upcoming meeting on June 16-17.