Dollar Holds Steady as Yen Nears Seven-Month High

The U.S. dollar remained broadly stable on Monday while the Japanese yen hovered near a seven-month high. The dollar index rose about 0.5 % to 99.59, its highest level since September 2. Against the yen, the dollar was up 0.7 % at 154.61 yen, retreating from a recent low just below 153.

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Investors weighed several concurrent forces. Heightened tension in the Middle East—spurred by Houthi strikes on Saudi Arabia and a shutdown of the kingdom’s main pipeline bypassing the Strait of Hormuz—lifted Brent crude by roughly 3 % to $108 a barrel, prompting a shift toward safe-haven assets. At the same time, speculation about imminent rate hikes from the Federal Reserve on Wednesday and possible policy tightening by the Bank of Japan added volatility to the dollar-yen pair. Additionally, headlines warning of AI-related risks for frontier-company CEOs weighed on equity markets, further supporting the dollar.

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• Dollar Index: 99.59 (up ~0.5 %) – highest since September 2.

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• Dollar/ Yen: 154.61 yen (up 0.7 %).

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• Euro: $1.153, a one-month low, down >0.5 %.

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• British Pound: $1.348, down 0.4 %.

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• Brent Crude: $108 per barrel, up 3 %.

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Currency strategist Francesco Pesole of ING noted that ongoing Gulf developments and AI-related headlines were pressuring equities, creating an environment that should keep the dollar supported.

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• “Gulf developments remain concerning, and some AI-related headlines are further weighing on equities - an environment where the dollar should remain supported,” — Francesco Pesole, currency strategist at ING

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