Dollar drops as Trump ceasefire prompts risk-on turn for markets

The dollar sank to its lowest level in two weeks at the start of trading in Asia on Wednesday, while the euro, yen, ‌Aussie ⁠and kiwi ⁠rallied hard after U.S. President Donald Trump said he had agreed to a two-week ceasefire with Iran.

The yen strengthened 0.6% against the greenback to 158.68 yen per dollar. The euro ⁠was up ‌0.7% at $1.167, while the British pound appreciated 0.7% to $1.3385. The ⁠Australian dollar climbed 1.3% to $0.7068 as its New Zealand counterpart jumped 1.4% to $0.5810.

Trump had earlier threatened widespread attacks on Iran's civilian infrastructure. Markets turned risk-on after the announcement, less than two hours before his ‌deadline for Tehran to reopen the Strait of Hormuz expired.


The U.S. dollar index, which ⁠measures the greenback's strength against a basket of six currencies, was down 1.0% at 98.97, a two-week low. Cryptocurrencies also rallied, with bitcoin advancing 3.4% to $71,664.41, as ether surged 5.7% to $2,234.78.