{
  "id": 1611779,
  "title": "Dollar feeble as rate hike bets dwindle, Iran war worries grow",
  "url": "https://urgent.news/2026/08/18/dollar-feeble-as-rate-hike-bets-dwindle-iran-war-worries-grow",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-08-18T02:08:00.000Z",
  "source": {
    "name": "The Economic Times - Top News",
    "slug": "the-economic-times-top-news",
    "url": "https://economictimes.indiatimes.com/markets/forex/forex-news/dollar-feeble-as-rate-hike-bets-dwindle-iran-war-worries-grow/articleshow/133309496.cms"
  },
  "original_language": "en",
  "account": "The U.S. dollar struggled on Tuesday, trading near multi-month lows across various major currencies. Traders were backing away from near-term monetary tightening expectations, though the potential for a Middle East war escalation cast a shadow over market sentiment. The euro held steady near $1.1581, while the British pound hovered at $1.3548, just shy of a three-month peak. Retail sales data for the previous week revealed a decline in July for the first time in nine months, following unexpected job losses and mild inflation readings. This series of weakening data prompted investors to reduce expectations of a rate hike by the U.S. Federal Reserve. The probability of a rate increase at the Fed's September meeting fell to 35%, down from 52.2% a week earlier. Despite this, analysts cautioned against predicting inflation's trajectory, particularly as the Strait of Hormuz remained closed and the U.S.-Iran conflict deadlock persisted. Inflation had been above target for the past five years, with Nohshad Shah, head of EMEA fixed income sales at Citadel Securities, suggesting that a 2% annual pace might be tolerable to the Fed, but it left little room for error in a world of constant supply shocks. Iran announced plans to adopt a fully offensive military posture due to stalled negotiations for a permanent end to the war with the U.S., a senior Iranian official informed Reuters. This announcement came as Washington dismissed the idea of extending the June ceasefire agreement. Global bond yields rose as traders remained wary of high oil prices and the prolonged closure of the Strait of Hormuz. Brent crude futures climbed 0.3% to $91.14 a barrel, after surging to a peak above $91.00 on Monday. The yield on the 30-year bond neared its highest level in nearly 20 years, while the 10-year Japanese government bond yield hit its highest level since September 1996. Investors were closely monitoring recent U.S. Treasury auctions for multi-decade yields demanded by Washington's borrowing needs. Concerns grew about the large-scale treasury auctions and the rising amount of U.S. debt, highlighting America's lack of fiscal discipline. The yen hovered just below 160 per U.S. dollar, shifting focus to the upcoming Bank of Japan meeting, where a potential rate hike was considered more aggressively after the central bank's recent intervention. The Australian dollar rebounded 0.11% to $0.71119, near its strongest level since early June. The New Zealand dollar also showed strength at $0.5902.",
  "summary": "The U.S. dollar weakened against major currencies as traders scaled back tightening expectations. Soft economic data, including retail sales and job losses, influenced these shifts. Traders now see a lower chance of a Federal Reserve rate hike in September. Elevated oil prices and geopolitical tensions in the Middle East are causing market fragility. Bond yields globally are rising due to…",
  "key_points": [
    "U.S. dollar near multi-month lows as rate hike bets diminish",
    "Iran's offensive military posture plan amid ongoing conflict worries markets",
    "Retail sales data declines for first time in nine months, prompting lower Fed rate hike expectations"
  ],
  "editors_take": "The dwindling expectations of a near-term US rate hike, fueled by weakening economic data, are weighing on the dollar, while escalating Middle East tensions are heightening investor anxiety.",
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}