2026.03.0401:45:46UTC+00Dollar Edges Higher on Inflation Worries

The dollar index rose to about 99.3 on Wednesday, extending its advance for a third straight session as mounting concerns over a prolonged conflict in the Middle East fueled expectations of persistently higher energy prices and renewed inflation pressures. In response, traders pared back bets on near-term Federal Reserve rate cuts, with markets now anticipating the next reduction in September instead of July, though two 25-basis-point cuts are still projected for this year. Additional support for the greenback came from safe-haven demand as the US-Israeli war on Iran entered its fifth day, with Israel on Tuesday striking a building where clerics had gathered to select a new Supreme Leader. US President Donald Trump warned that the attacks could usher in a new Iranian leadership no less troubling than the previous regime, highlighting the conflict’s uncertain path. The dollar strengthened across the board, recording its largest gains so far this week against the euro and the antipodean currencies.