USD Faces Geopolitical Pressure as US-Iran Deal Talks Intensify

The US dollar faces uncertainty as the week opens amid intensifying speculation over a potential US-Iran agreement. Discussions surrounding a diplomatic endgame between Washington and Tehran have introduced geopolitical risk premiums into currency markets, with traders closely monitoring developments for their implications on oil prices and broader risk sentiment. A successful deal could ease sanctions-related supply constraints on Iranian crude, potentially lowering oil prices and reducing demand for safe-haven assets including the dollar. Conversely, a breakdown in talks could spike volatility and bolster USD demand as a refuge. Crude oil-sensitive currencies such as CAD and NOK may see heightened activity depending on the outcome. The dollar index remains in a consolidation range as markets weigh the probability and scope of any agreement. Traders should watch for official statements from both sides, as any concrete progress could shift risk appetite significantly. Near-term positioning is expected to remain cautious, with geopolitical headlines likely driving intraday volatility across major and commodity-linked pairs.