Categories: Business

Dollar Index Yen Stabilises as Markets Watch Fed and Middle East

The US dollar remains under pressure as the yen steadies and markets monitor global developments.

Dollar Index traded near a six-week low on Wednesday as the Japanese yen stabilised after recent market intervention. Investors also welcomed signs of diplomatic progress in the Middle East.

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The yen strengthened slightly to 157.60 per US dollar. However, it remained above this week’s high after recovering from recent multi-decade lows.

US Backs Japan’s Currency Efforts

US Treasury Secretary Scott Bessent said Washington would support Japan’s efforts to stabilise the yen.

Moreover, he expressed confidence that Bank of Japan Governor Kazuo Ueda would make decisions that best support the country’s economy.

His comments strengthened expectations that the Bank of Japan could raise interest rates at its policy meeting on September 17–18.

Dollar Holds Near Six-Week Low

The US Dollar Index (DXY) remained largely unchanged at 99.85 after touching its lowest level in six weeks earlier this week.

Meanwhile, the euro traded at $1.1533, while the British pound held steady at $1.3458.

The New Zealand dollar slipped after unemployment rose to a 10-year high. In contrast, the Australian dollar remained broadly unchanged.

Oil Prices Ease

Oil prices extended their decline as hopes for diplomatic progress between the United States and Iran reduced concerns about supply disruptions.

As a result, Brent crude futures fell again after dropping 5% in the previous session.

Qatar said mediators were making progress in efforts to ease regional tensions. Investors believe a breakthrough could improve shipping through the Strait of Hormuz.