U.S. Dollar Slides As Strait Of Hormuz Crisis Intensifies

(RTTNews) - The U.S. Dollar value inches lower amid renewed escalation in the Strait of Hormuz crisis that pushed crude oil prices higher and sparked inflationary concerns once again lowering the risk appetite for investors.

The U.S. Dollar Index, DXY, which measures the Greenback against a basket of other major currencies was last seen trading at 98.46, up by 0.31 (or 0.32%) today.

According to the U.S. Census Bureau, factory orders rose 1.50% month-over-month to $630.40 billion in March, beating market expectations of 0.50% and following an upwardly revised 0.30% increase in February.

While against the Euro, USD was trading at 1.169, up by 0.25%, against the GBP, it was trading at 1.353, up by 0.27%.

Against the USD, the Japanese Yen was trading at 157.219, down by 0.13%; the Swiss Franc was trading at 0.784, down by 0.38%; and the Canadian Dollar was trading at 1.362, down by 0.28%.

Against one unit of Australian Dollar, USD was trading at 0.716, up by 0.48%. The Melbourne Institute's Australia's Monthly Inflation Gauge rose 0.60% month-on-month in April, easing from a record 1.30% surge in the previous month.

Since February 28 when the U.S-Israel versus Iran war began in the Middle East, the Strait of Hormuz remains blocked, sending oil prices higher and higher.

While several ships remain stranded at sea, on Sunday, through Truth Social, U.S. President Donald Trump stated that the U.S. will ensure a safe movement for the stranded vessels at the Strait of Hormuz as many countries requested the U.S. though he did not name the countries.

Trump also asserted that after leaving, the vessels would not be returning until the situation returns to normalcy.

Termed "Project Freedom", Trump remarked that the U.S. is taking this initiative as a "humanitarian gesture" and "goodwill act" without providing much details on the mechanism.

However, Trump went on to warn that any "interference" by Iran will be dealt with forcefully.

Iranian military issued warnings to the U.S. forces not to enter the strait.

On Monday, the U.S.-led maritime task force began guiding the stranded ships across the Strait of Hormuz on how to circumvent the sea mines planted by Iran earlier and detour safely.

Associated Press reported that the U.S.-led Joint Maritime Information Center has installed an "enhanced security area", south of the usual shipping routes.

The U.S. Central Command announced that the project would involve several guided-missile destroyers along with 100 aircraft and 15,000 service members.

Iran's navy stated that it turned away "enemy" warships with a "decisive warning". The U.S. Central Command, however, stated that no U.S. ships were hit.

Admiral Brad Cooper of U.S. Central Command stated that the U.S. forces eliminated six small boats attempting to interfere with commercial shipping but Iran's state media denied the claims.

Sparking doubts on the longevity of the ongoing ceasefire, the United Arab Emirates stated that it was under attack from Iranian drones and missiles.

The prevailing uncertainty kept markets on the edge.

On the diplomatic front, Trump also informed that the U.S. representatives were engaged in very positive discussions with Iran, and suggested potential diplomatic progress was going on.

Separately, Trump rejected the latest proposal submitted by Iran calling it unacceptable while Iran's Foreign Ministry spokesperson Esmeil Baghaei stated that Iran is reviewing the U.S. response to its proposal.

Iran wants issues other than the Strait of Hormuz reopening be resolved within 30 days instead of extending the ceasefire.

The prevailing geopolitical tension supported the U.S. dollar value.