Dollar Stagnates Amid Supreme Court's Tariff Decision and Middle East Tensions

The U.S. Supreme Court's decision to strike down Trump's tariffs has unsettled dollar markets already strained by potential conflict with Iran. While the euro and yen held steady, sterling saw a slight rise. Trump's response has added complexity to global economic dynamics alongside fluctuating interest rates and geopolitical concerns.

The dollar remained flat on Monday after the U.S. Supreme Court's verdict to overturn President Trump's tariffs fueled uncertainty in financial markets. Already anxious due to potential U.S.-Iran conflicts, the dollar held steady against the euro, but saw a minor decline against the yen and a slight rise against sterling.

Invesco's chief global market strategist, Brian Levitt, noted that these shifts might be short-lived, labeling them as knee-jerk reactions rather than significant economic indicators. While the Supreme Court deemed Trump's authority exceeded, the President announced a new 15% import levy, vowing to uphold higher-tariff deals with partners.

The geopolitical landscape could destabilize further as military tensions with Iran arise, shaking oil markets due to Tehran's strategic threats. Analysts suggest the situation could paralyze financial markets and lead to lengthy legal battles over tariff refunds, adding layers of complexity to global trade relations.

(With inputs from agencies.)