Previous hopes for de-escalation gave way to a new wave of uncertainty as Iran warned that Washington would “bitterly regret” the sinking of an Iranian warship off the coast of Sri Lanka.
This kept the dollar in good shape, causing the euro and sterling to fall slightly. The strength of the American currency in recent days is clearly visible in the so-called dollar index (DXY, the popular “Dixie”), which measures its performance against a basket of six other currencies. This index recently increased by 0.11% to 98.91. Although it is worth emphasizing that in a slightly longer period the dollar has experienced a weaker period: at the beginning of 2025, the index of this currency was recorded around 110.
– Everyone is groping in the dark. “Most investors realize they don't have a lot of confidence in the outlook amid these stresses, which makes markets react very strongly even to minor events,” said Nick Rees, head of macroeconomic research at Monex, as quoted by Reuters.
– There seems to be no escape. Traditional safe havens such as gold are not playing their usual role, said Bas van Geffen, senior macro strategist at Rabobank, highlighting a key factor: the great liquidity of the dollar. Interestingly, Bitcoin has performed better than gold in recent days of the turmoil around Iran.
The dollar has gained almost 1.3 percent so far. during the week, becoming one of the few winners in several volatile sessions that dragged down stocks, bonds and at times even safe-haven precious metals.
A sharp rise in energy prices caused by the war in the Middle East has raised fears of a renewed rise in inflation that could undermine the interest rate prospects of major central banks.
According to the CME FedWatch tool, investors are currently valuing only 31.5%. chances of the Federal Reserve cutting interest rates in June, down from almost 46%. chance a week ago, although this is partly due to optimistic US economic data released on Wednesday.
The zloty was losing against the dollar on Thursday
Despite a clear relief in the markets, which showed signs of panic on Tuesday, the dollar was gaining against the zloty on Thursday. Approximately At 1:15 p.m. the USD/PLN rate was increasing by 0.45%. and you had to pay PLN 3,686 for American currency on the interbank market. However, this is less than the almost PLN 3,735 that was temporarily on the quotation boards on Tuesday.
And although the dollar exchange rate is still higher than before the US and Israel attacked Iran (in the middle of last week it fluctuated around PLN 3.57) and compared to the low at the end of January (PLN 3.478, the lowest level in almost eight years), it is lower than a year ago at this time, when it was around PLN 3.85.
“In addition to market participants, central bankers are increasingly viewing the return of inflation as a cause for concern,” said Thierry Wizman, global currency and interest rate strategist at Macquarie Group. He added that it is the prospects for US interest rates that have the greatest potential to change (or not change) as a result of another increase in global inflation in 2026 if energy supplies are curtailed.
