The US Dollar Index climbed higher after both President Trump and Iran rejected the latest peace proposals.

• The US Dollar Index strengthened as rising risk aversion followed the rejection of each other’s latest peace proposals by President Trump and Iran.
• President Trump dismissed Iran’s latest peace offer, describing it as “totally unacceptable.”
• Meanwhile, US Nonfarm Payrolls increased by 115K in April, surpassing market expectations despite easing from March’s revised 185K gain.

The US Dollar Index (DXY), which tracks the US Dollar (USD) against a basket of six major currencies, remained firm after posting modest losses in the previous session, trading near 98.10 during Monday’s Asian session.

The Greenback continued to strengthen amid heightened risk aversion after US President Donald Trump and Iran rejected each other’s latest peace efforts aimed at easing tensions in the Middle East. According to Bloomberg, Trump dismissed Iran’s recent peace proposal on Sunday, calling it “totally unacceptable.” Meanwhile, Iranian state television cited an Iranian official as saying Tehran’s response focused on ending the conflict across all fronts, especially in Lebanon, while also addressing the security of shipping lanes through the strait, although no specifics were given regarding the reopening of the crucial waterway.

Ongoing tensions in the Middle East, along with the fragile ceasefire between the US and Iran, are likely to sustain safe-haven demand for the US Dollar, which could continue to pressure major currency pairs in the near term.

Data released by the US Bureau of Labor Statistics on Friday showed that Nonfarm Payrolls (NFP) increased by 115K in April, slowing from March’s revised 185K gain but still beating market expectations of 62K. Meanwhile, the Unemployment Rate held steady at 4.3% in April, in line with analyst forecasts.