The U.S. dollar weakened against all major world currencies after the United States and Iran reached a two-week truce, reducing demand for safe havens and sending oil prices crashing.
According to data from the Bloomberg agency, the dollar index fell as much as 0.97 percent, reaching its lowest level in the last four weeks.
That wiped out more than half of the gains made by the US currency since the conflict began in late February.
The weakening of the dollar is also associated with a drop in yields on US government bonds, while investors have diverted their capital to riskier assets.
Risk-sensitive currencies, such as the South African rand and the Swedish krona, gained the most by around two percent.
The truce implies that Iran will provide safe passage for ships through the Strait of Hormuz for two weeks, thereby stabilizing the supply of oil and other raw materials on the global market.
The euro rose nearly one percent to $1.1709, its highest level in more than a month, while China’s yuan hit a three-year high against the dollar, supported by the People’s Bank of China.
There was also a change in sentiment on the options market, as investors rapidly closed positions that bet on the strengthening of the dollar, although the American currency still maintains a slight advantage in long-term expectations, reports Tanjug.
