AUD Gains as US-Iran Hormuz Deal Sinks USD, Oil

The Australian Dollar strengthened against the US Dollar on Monday, gaining more than 0.37% in the wake of a diplomatic breakthrough between the United States and Iran.

Both sides agreed to a Memorandum of Understanding to end hostilities and pave the way for negotiations on Tehran's nuclear program. The deal eased geopolitical tensions linked to the Strait of Hormuz, a key oil transit chokepoint, sending crude prices lower and pressuring the greenback.

As a commodity-linked currency, the Aussie benefited from the improved risk sentiment and a weaker USD. Market participants now watch for further details on the MOU's implementation.