US Dollar Recovers Further Ahead of US Inflation, Middle East Tensions

The US dollar continued to grind higher on Monday, erasing more of the decline triggered by Friday’s softer-than-expected US employment report. Traders squared positions ahead of key US inflation figures that are expected to shape expectations for future Federal Reserve rate moves.

Rising geopolitical tensions in the Middle East added to the greenback’s bid, as investors sought safety amid reports of escalating conflicts. The combination of cautious positioning and haven demand put the dollar index on track for its strongest session in a week.

Oil markets were also in focus, with Brent crude prices under pressure as the demand outlook took precedence over supply-side pledges. However, the primary driver across asset classes remained the countdown to the US inflation data.