The US dollar index strengthened and returned above the 98 level on Friday (May 8), maintaining gains from the previous session amid escalating geopolitical tensions in the Strait of Hormuz. Moderate risk-off sentiment boosted demand for safe-haven assets, although weekly dollar movements remained limited.
The latest tensions were triggered by reports that three US Navy destroyers transiting the strait intercepted an Iranian attack and retaliated. President Donald Trump stated that the ceasefire remains in effect, but markets continue to view the situation as a risk factor that could disrupt energy flows and trigger volatility across assets.
The Trump administration is reportedly still awaiting Iran’s response to a proposal to reopen Hormuz and end the nearly 10-week conflict. Several reports indicate that Tehran is expected to deliver a response via Pakistan within the next two days, so geopolitical headlines remain a potential short-term driver.
Investors are also focused on the release of the April jobs report. Consensus estimates an increase of 62,000 jobs, a slowdown from 178,000 in March, while the unemployment rate is projected to remain at 4.3%. Despite the dollar’s strengthening on Friday, the dollar index is expected to close the week relatively stable against most major currencies, with the market awaiting a combination of geopolitical signals and employment data to gauge the next direction in interest rates. (asd)
Source: Newsmaker.id