USD Firms as Iran Keeps Hormuz Strait Restricted Ahead of Talks

The US dollar continues to find safe-haven support as Iran maintains its stranglehold on the Strait of Hormuz, with shipping data showing only four dry-bulk vessels and four tankers—three of them Iran-linked—transiting the critical waterway in the past 24 hours. The restricted passage, which handles roughly 20% of global oil supply, is keeping crude prices elevated and sustaining geopolitical risk premiums across forex markets. USD/JPY remains bid as traders seek dollar safety, while commodity-linked currencies such as AUD and CAD face mixed signals—CAD benefits from elevated oil prices but is weighed down by broader risk aversion. With US-Iran negotiations set to begin in Islamabad, Tehran appears intent on preserving its leverage, offering no goodwill gestures to ease maritime tensions. Traders should monitor headline risk closely, as any breakthrough or breakdown in talks could trigger sharp moves in oil-sensitive and safe-haven pairs. Key pairs to watch include USD/JPY, USD/CAD, and AUD/USD, with volatility likely to remain elevated until clarity emerges on the diplomatic front.