Dollar trades near 7-month low against yen as oil settles above $100

On Wednesday, the U.S. dollar traded near a seven-month low against the yen, as oil prices surged above $100 a barrel due to an escalating Middle Eastern conflict. Investors were positioning themselves for upcoming central bank meetings in the coming week. The dollar faced pressure partly because of the yen's sharp gains over the past week and expectations surrounding policy decisions from the Federal Reserve and Bank of Japan.

The currency was down 0.23% at 153.65 yen, close to its seven-month low of 152.89 yen observed on Tuesday. Kevin Ford, an FX & Macro strategist at Convera, explained that the U.S. policy premium was limiting the dollar's advance, while the yen was strengthening with support from the U.S. Treasury.