USD Strengthens as Iran Strait of Hormuz Tensions Ease Slightly

The US dollar saw mixed trading as Iran publicly stated it would not close the Strait of Hormuz, a critical chokepoint for global oil shipments. Despite the reassurance, market participants remain cautious as war risks in the region have effectively curtailed shipping traffic through the strait, keeping oil supply disruptions elevated. Crude oil prices remain above $100 per barrel, sustaining inflationary pressure that supports USD safe-haven demand. The USD/JPY pair continues to trade with a bid tone as risk-off sentiment drives flows into the dollar, while commodity-linked currencies such as CAD benefit from elevated energy prices. USD/CAD has seen downward pressure as oil strength bolsters the loonie. Key support for DXY sits near 104.50, with resistance at 105.80. Traders should monitor further developments in Middle East hostilities, as any escalation could trigger sharp moves in oil-sensitive and safe-haven currency pairs. The Federal Reserve's stance on inflation tied to energy costs remains a critical watch point.