Lates News

The options market indicates that due to the Iran war maintaining high energy prices, the US dollar is trending towards hitting a new high for 2026. The US dollar spot index rose 0.3% in early London trading, potentially reaching the highest closing price in nearly two months. According to option indicators, traders are betting that the dollar could rise to its highest point since December of last year. The one-month risk reversal index, which measures the difference in demand for bullish and bearish options on the US dollar against major currencies, rose to 92 basis points, the highest level since the end of 2022. Goldman Sachs economists Manuel Abecasis and David Mericle predict that Brent crude oil prices will average $98 in March and April, then fall to $71 in the fourth quarter. They expect this to significantly increase inflation, leading the Federal Reserve to postpone its first interest rate cut from June to September this year. This shift means a longer period of wider interest rate differentials, which typically supports buying of the US dollar, especially for currencies facing trade condition pressures and needing to import energy. With oil driving macro pricing, this further strengthens the US dollar's status as a "petrocurrency".