Dollar set for steepest weekly gain in a year as Iran crisis boosts haven bid

TOKYO, March 6 : The U.S. dollar held broadly steady in early Asian trade on Friday and was poised for its steepest weekly gain in more than a year as the escalating conflict in the Middle East drove demand for safe-haven assets.The euro and yen remained on the back foot as the crisis drove oil prices ever hi

TOKYO, March 6 : The U.S. dollar held broadly steady in early Asian trade on Friday and was poised for its steepest weekly gain in more than a year as the escalating conflict in the Middle East drove demand for safe-haven assets.

The euro and yen remained on the back foot as the crisis drove oil prices ever higher, spurring inflation risks in economies dependent on energy imports and upending expectations for policy by the Federal Reserve and other central banks.

Earlier hopes of a de-escalation gave way to fresh uncertainty, with Iran warning that Washington would "bitterly regret" the sinking of an Iranian warship. U.S. President Donald Trump said he wanted to be involved in choosing Iran's next head of state after U.S. and Israeli air strikes killed Supreme Leader Ali Khamenei in the early moments of the war.

"If the Middle Eastern conflict continues at its current intensity, it's likely to bring sustained higher inflation, a stronger U.S. dollar, and a vastly reduced chance of Fed rate cuts," IG market analyst Tony Sycamore wrote in a note.