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2026.03.0601:44:38UTC+00Dollar Set for Strong Weekly Gain

The dollar index held near 99 on Friday and was on track to rise more than 1% for the week, supported by safe-haven demand as the escalating conflict in the Middle East and climbing oil prices rattled financial markets. The US-Israeli offensive against Iran has now entered its seventh day, while Tehran has responded with a new wave of missile and drone strikes across the Gulf. President Donald Trump also said he wants a say in choosing Iran’s next leader, dismissing Mojtaba Khamenei, son of the late supreme leader, as an unlikely candidate. Rising oil prices have intensified fears of a resurgence in global inflation, strengthening expectations that the Federal Reserve will postpone interest rate cuts and weighing on the currencies of major oil-importing countries. Markets have pushed back their forecasts for the next Fed rate reduction to September or October, from previous expectations of July. The dollar’s strongest gains this week were against the euro, underscoring Europe’s significant dependence on Middle Eastern oil.

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