Dollar slumps in broad risk rally after Trump announces Israel-Iran ceasefire
SINGAPORE, June 24 — The US dollar fell today while its Australian and New Zealand counterparts rose after President Donald Trump announced a ceasefire between Israel and Iran, in news that sent investors cheering and sparked a risk rally across markets.
Trump announced a complete ceasefire between Israel and Iran, potentially ending the 12-day conflict that led millions of people to flee Tehran and prompted fears of further escalation in the war-torn region.
But there was no confirmation from Israel, and the Israeli military said Iran launched waves of missiles today just hours after the announcement. Trump later said the ceasefire 'is now in effect' and urged both countries to not violate it.
The risk-sensitive Aussie got a lift and last traded 0.5 per cent higher at US$0.6493 (RM2.76) as did the kiwi, which rose 0.55 per cent to US$0.6009.
Israel's shekel rallied sharply too, jumping 1 per cent against the dollar to its strongest level since February 2023.
'It's obviously positive news for risk sentiment,' said Rodrigo Catril, senior currency strategist at National Australia Bank, of the announced ceasefire.
'We need to obviously have a bit more detail in terms of exactly what all this means... I suppose it will be the conditions of the ceasefire, and what are the conditions for a more longer-lasting peace deal.'
The dollar, which last week drew support from safe-haven demand, fell broadly in the wake of the news.
Against the yen, the greenback was down 0.47 per cent at 145.45 .
The euro rose 0.23 per cent to US$1.1605 and sterling advanced 0.27 per cent to US$1.3564.
The yen and euro benefited from a slide in oil prices as both the EU and Japan rely heavily on imports of oil and liquefied natural gas, while the United States is a net exporter.
Adding to headwinds for the dollar were dovish comments from Federal Reserve policymaker Michelle Bowman, who said the US central bank should consider interest rate cuts soon.
Bowman's openness to cutting rates soon is supported by Fed Governor Christopher Waller, who said in a television interview last week that he would also consider a rate cut at next month's meeting.
Against a basket of currencies, the dollar was slightly lower at 98.12, extending its more than 0.5 per cent decline in the previous session.
Fed Chair Jerome Powell is due to testify before the US Congress today and tomorrow, where focus will be on the outlook for US rates.
'There appears to be increasing division among the ranks of the Fed board ahead of Fed Chair Powell's testimony,' said Tony Sycamore, a market analyst at IG.
'The chance of a July rate cut... is still underpriced. I think it should be higher than that.'
Markets are now pricing in close to a 23 per cent chance the Fed could ease rates in July, up from 14.5 per cent a day ago, according to the CME FedWatch tool.
In cryptocurrencies, bitcoin rose more than 1 per cent to US$105,155.52, while ether jumped 2.7 per cent to US$2,412.54, in a reflection of the positive risk sentiment. — Reuters per cent
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
New Straits Times
42 minutes ago
- New Straits Times
US Senate approves Trump's 'One Big Beautiful Bill'
MOSCOW: The US Senate has approved President Donald Trump's "One Big Beautiful Bill" by a majority vote, reported Sputnik/RIA Novosti citing a NBC News report. The lower house of the US Congress in May passed a bill promoted by Trump that cuts federal spending but simultaneously provides significant tax breaks. As a result, according to the Congressional Budget Office, both the budget deficit and the national debt will grow. It is noted that 51 people voted for the bill, 49 voted against it. The day before, US billionaire entrepreneur Elon Musk criticised the latest version of the bill on cutting government spending, saying that the document could destroy millions of jobs in the United States.
New Straits Times
an hour ago
- New Straits Times
US Senate opens debate on Trump's controversial spending bill
WASHINGTON: US senators on Saturday began debating Donald Trump's "big beautiful" spending bill, a hugely divisive proposal that would deliver key parts of the US president's domestic agenda while making massive cuts to social welfare programs. Trump is hoping to seal his legacy with the "One Big Beautiful Bill," which would extend his expiring first-term tax cuts at a cost of US$4.5 trillion and beef up border security. But Republicans eyeing 2026 midterm congressional elections are divided over the package, which would strip health care from millions of the poorest Americans and add more than US$3 trillion to the country's debt. The Senate formally opened debate on the bill late Saturday, after Republican holdouts delayed what should have been a procedural vote – drawing Trump's ire on social media. Senators narrowly passed the motion to begin debate, 51-49, hours after the vote was first called, with Vice President JD Vance joining negotiations with holdouts from his own party. Ultimately, two Republican senators joined 47 Democrats in voting "nay" on opening debate. Trump has pushed his party to get the bill passed and on his desk for him to sign into law by July 4, the United States' independence day. Democrats are bitterly opposed to the legislation and Trump's agenda, and have vowed to hold up the debate. They began by insisting that the entirety of the bill be read aloud to the chamber before the debate commences. The bill is roughly 1,000 pages long and will take an estimated 15 hours to read. "Republicans won't tell America what's in the bill," said Senate Democratic Leader Chuck Schumer. "So Democrats are forcing it to be read start to finish on the floor. We will be here all night if that's what it takes to read it." If passed in the Senate, the bill would go back to the House for approval, where Republicans can only afford to lose a handful of votes – and are facing stiff opposition from within their own ranks. Republicans are scrambling to offset the US$4.5 trillion cost of Trump's tax relief, with many of the proposed cuts to come from decimating funding for Medicaid, the health insurance program for low-income Americans. Republicans are split on the Medicaid cuts, which will threaten scores of rural hospitals and lead to an estimated 8.6 million Americans being deprived of health care. The spending plan would also roll back many of the tax incentives for renewable energy that were put in place under Trump's predecessor Joe Biden. On Saturday, key Trump ally Elon Musk – with whom the president had a public falling out this month over his criticism of the bill – called the current proposal "utterly insane and destructive." "It gives handouts to industries of the past while severely damaging industries of the future," said Musk, who is the world's richest person, and owns electric vehicle company Tesla and space flight firm SpaceX, among others. Independent analysis also shows that the bill would pave the way for a historic redistribution of wealth from the poorest 10 per cent of Americans to the richest. The bill is unpopular across multiple demographic, age and income groups, according to extensive recent polling. Although the House has already passed its own version, both chambers have to agree on the same text before it can be signed into law.
New Straits Times
2 hours ago
- New Straits Times
Nvidia insiders sold over US$1bil in stock amid market surge
NEW YORK: Nvidia insiders sold over US$1 billion worth of company stock in the past year, with a notable uptick in recent trading activity as executives capitalize on surging investor interest in artificial intelligence, the Financial Times reported on Sunday. More than US$500 million of the share sales took place this month as the California-based chips designer's share price climbed to an all-time high, the report said. Nvidia's chief executive Jensen Huang started selling shares this week for the first time since September, the SEC filing showed. Nvidia's stock hit a record on Wednesday, and the chipmaker reclaimed the crown as the world's most valuable company after an analyst said the chipmaker was set to ride a "Golden Wave" of artificial intelligence. Its latest gains reflect the US stock market's return to the "AI trade" that fueled massive gains in chip stocks and related technology companies in recent years on optimism about the emerging technology. Nvidia did not immediately respond to a Reuters request for comment. Nvidia's shares have rebounded over 60 per centfrom their closing low on April 4, when Wall Street was reeling from President Donald Trump's global tariff announcements. US stocks, including Nvidia, have recovered on expectations the White House will reach trade deals to soften the tariffs.
