Dollar stays near 18-month high as Mideast conflict, inflation data in focus

The US dollar maintained its near 18-month high in early Asian trade on Monday, as tensions in the Middle East and forthcoming US inflation data influenced investor sentiment. Oil prices fluctuated following heightened Houthi strikes in Yemen and two recent tanker attacks, with Brent crude futures falling 1% to $103.55 per barrel.

The dollar index, which gauges the greenback's strength against six currencies, slipped slightly to 102.14 but remained near the 18-month peak reached last week. Analysts at Commonwealth Bank of Australia forecast the Houthis would persist in their assaults on Saudi Arabian energy infrastructure, bolstering oil prices and the dollar.

However, a breakthrough in the US-Iranian peace proposal remains unlikely this week. Meanwhile, traders focus on Wednesday's US consumer price index report, expected to provide crucial insights into the Federal Reserve's upcoming interest rate decision. Currently, there is an 81% chance of the Fed maintaining rates, up from 51% a month prior.

The euro and British pound also experienced minor gains and remained stable, respectively, amid investor concerns about France's fiscal situation and global energy markets.