Opinion: Due to escalating inflation concerns, the expected rate cut has been significantly downgraded, and the dollar may experience its largest gain in a year.

SmartContractAuditor · 2026-03-03T12:56:20+00:00

The Iran conflict has led to rising energy prices, with the US dollar index up 0.8%, and US Treasury yields hitting a three-week high. The rate cut expectation has decreased to 37 basis points. Crude oil has broken through $85 for the first time, and European natural gas prices surged 40%. G10 currencies generally declined, and US dollar investors' bullish sentiment has strengthened.

SmartContractAuditor

2026-03-03 12:56:20

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Odaily Planet Daily News: The ongoing conflict in Iran continues to escalate, leading to a surge in energy prices and heightening concerns about inflation. The US dollar is expected to see its strongest two-day rally in nearly a year.

On Tuesday, the Bloomberg US Dollar Spot Index rose 0.8%, pushing US Treasury yields to a three-week high and significantly lowering the Federal Reserve’s expected rate cut for this year to just 37 basis points—down from 60 basis points last Friday. Oil prices broke above $85 per barrel for the first time since July 2024, while European natural gas prices surged over 40%, reaching their highest level since 2023.

Due to real-money investors selling euro and pound long positions, US dollar options and risk reversals shifted sharply to bullish, reaching their largest extent since June. Most G10 currencies declined by 1% or more.

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