The dollar weakened as an Iran ceasefire triggered a shift toward riskier assets in global markets.

The U.S. dollar fell to a one-month low in Wednesday’s Asian session, while major currencies such as the euro, yen, Australian dollar, and British pound surged after President Donald Trump announced a two-week ceasefire agreement with Iran.

The yen gained 0.8% to 158.36 per dollar, the euro rose 0.7% to $1.1674, sterling advanced 0.8% to $1.34, and the Aussie jumped 1.1% to $0.7054. Earlier, Trump had issued strong threats against Iran’s civilian infrastructure, warning of severe consequences if his demands were ignored, drawing global criticism.

Market sentiment quickly shifted toward risk-taking following the ceasefire news, which came shortly before a U.S. deadline for Iran to reopen the Strait of Hormuz. Analysts noted that reopening the key shipping route could further support the current rally, though uncertainty remains over the coming two weeks, leaving currencies exposed to potential pullbacks.

Attention then moved to central bank policy outlooks as oil prices plunged. Brent crude dropped 13.4% to $94.68 per barrel, though it stayed elevated compared to pre-conflict levels.

The New Zealand dollar rose 1.5% to $0.5819 after the country’s central bank held its policy rate at 2.25% for a second consecutive meeting, while signaling readiness to act if inflation rises. Meanwhile, Fed funds futures suggested a roughly even chance of a 25-basis-point rate cut by the Federal Reserve in December, a shift from the previous day’s stronger expectation that rates would remain unchanged.

The dollar index slipped for a third straight session to 98.838, its lowest since March 11. Elsewhere, the South Korean won climbed 1.6% despite renewed tensions on the Korean Peninsula, where North Korea launched additional ballistic missiles.

Cryptocurrencies also advanced, with bitcoin rising 2.9% to $71,327.07 and ether gaining 5.6% to $2,233.90.

Sources: Reuters