U.S. Dollar Slides After Crude Oil Falls Amid Prospects Of A U.S.-Iran Deal

(RTTNews) - The U.S. Dollar value inches lower as inflationary pressure lowers following plummeting crude oil prices with rising possibilities of a U.S.-Iran deal to reopen the Strait of Hormuz anytime in the coming days.

Today, the U.S. Dollar Index DXY which measures the Greenback against a basket of other major currencies was last seen trading at 99.87, down by 0.14 (or 0.14%).

On the data front in the U.S., the U.S. Bureau of Economic Analysis revealed that the trade deficit narrowed to $73.30 billion in June from $77.6 billion in May, broadly in line with market expectations.

While imports declined 1.80% to $388.00 billion, exports fell 0.90% to $314.70 billion.

Data released by the U.S Bureau of Statistics revealed that the job openings decreased by 178,000 to 7,359,000 in June, below market expectations of 7,400,000, indicating a weaker labor market.

The number of workers leaving their jobs on their own volition rose by 79,000 to 3,230,000 in June, from a revised 3,150,000 in the previous month.

While against the Euro, the USD was trading at 1.153, down by 0.23%, against the GBP, the USD was trading at 1.345, down by 0.18%.

Against the USD, the Japanese Yen was trading at 157.724, down by 0.37%, the Swiss Franc was trading at 0.809, up by 0.11%.

Against the USD, the Canadian Dollar was trading at 1.406, down by 0.14%.

According to the data from Statistics Canada, Canada recorded a trade surplus of CAD3.86 billion (nearly USD2.74 billion) in June, widening from the C$3.70 billion in May to mark the largest surplus in over four years.

Exports rose by 0.40% from the previous month to a record high of CAD77.50 billion. Imports rose by 0.20% to a record of CAD73.60 billion.

Against one unit of Australian Dollar, the USD was trading at 0.705, down by 0.67%.

Today, concerns over high interest rate in the U.S. in the near-term lowered following the easing of oil-linked inflationary pressures.

A heavy plunge in crude oil prices, reduced Middle East tensions.

Since Friday, escalation in the gulf conflict offered the geopolitical risk premium to crude oil prices.

On Friday, U.S. President Donald Trump warned of a massive strike on Iran in a never-before-seen scale.

U.S. embassies in Middle East advised American citizens to get ready to depart at a short notice and the U.S. military was fully locked and loaded to strike on Iran.

However, late Saturday, Trump reversed his decision and called off the attacks at the request of U.S. allies in the gulf and to give diplomacy one more chance.

On Sunday, Trump stated that fresh talks with Iran would begin on Monday afternoon.

After Iran repeatedly denied Trump's claim of any planned talks, through Truth Social, Trump confirmed again that talks are ongoing.

Later, Trump warned that this is the last chance given to Iran.

Relieving market tensions, today, U.S. Treasury Secretary Scott Bessent stated that both nations are engaged in talks and possibly the Strait of Hormuz could reopen in a couple of days.

Later, Qatar's Foreign Ministry Spokesperson Majed al-Ansari clarified that mediatory efforts to secure a truce between the U.S. and Iran are making progress.

The message renewed the optimism on resumption of shipping traffic across the Strait of Hormuz after which crude oil prices sank heavily.

With inflation concerns now reduced, bets on interest rate-hikes in the U.S. in the near-term are currently diminishing.

Currently, investors are betting on a 56.90% chance of a quarter-point interest rate-hike (against yesterday's 64.50%) in the upcoming meeting of the U.S. Federal Reserve on September 15-16, according to the CME Group's FedWatch Tool.