SINGAPORE: The U.S. dollar declined during early Asian trading on Monday, as optimism surrounding a potential agreement to reopen the Strait of Hormuz drove oil prices back below the $100 per barrel threshold. This shift occurred despite the Trump administration tempering expectations regarding the immediate timeline for a deal with Iran.
In currency markets, the U.S. dollar fell 0.2% against the yen to 158.87, while the euro climbed 0.3% to $1.1642 and the British pound increased by 0.4% to $1.3485.
Market liquidity remained thin across the region on Monday due to various global holiday closures.
The Australian dollar rose 0.4% to $0.7160, and the New Zealand dollar gained 0.5% to $0.5877.
“Early indicators suggest that risk sentiment is being supported, with early trade in Sydney showing a broad sell-off of the USD, benefiting risk-sensitive currencies such as the AUD,” Westpac analysts noted in a recent research report.
Over the weekend, the outlook for a permanent peace deal remained precarious. On Saturday, President Donald Trump indicated that a memorandum of understanding with Iran had been “largely negotiated,” with progress reported by both nations and mediators in Pakistan.
However, in a Sunday post on Truth Social, Trump clarified that the U.S. blockade of Iranian vessels in the Strait of Hormuz would “remain in full force and effect” until a formal agreement is reached, certified, and signed. The Iranian government has not yet issued a response.
The energy markets responded sharply, with Brent crude dropping 5.1% to $98.29 a barrel and U.S. West Texas Intermediate falling 5% to $91.76 a barrel.
Despite the volatility, some traders remain cautiously optimistic. “Markets have learned to be patient regarding a tangible breakthrough, but the fundamental expectation of a deal remains strong. The weekend’s developments provide further conviction, even if the exact timing remains uncertain,” said Chris Weston, head of research at Pepperstone Group Ltd in Melbourne.
In the cryptocurrency space, Bitcoin edged up 0.6% to $77,043.60, while Ether rose 0.4% to $2,099.77.
![Lebanon Crisis Threatens Fragile US-Iran Ceasefire Agreement]](https://i3.wp.com/static01.nyt.com/images/2026/06/19/multimedia/19mideast-lebanon-fghc/19mideast-lebanon-fghc-facebookJumbo.jpg?w=1024&resize=1024,1024&ssl=1 "Lebanon Crisis Threatens Fragile US-Iran Ceasefire Agreement]")
