The Middle East crisis has escalated into an all-out war after the US and Israel assassinated the Supreme Leader of Iran on February 28. Iran not only targeted Israel but also attacked United States (US) military bases around the Persian Gulf.

The Dow Jones Industrial Average was down around 600 points, or 1.26%, near 47,340 at the time of writing, capping off a brutal week that saw the blue-chip index shed over 1K points. The S&P 500 traded near 6,750, down around 1.1%, while the Nasdaq Composite hovered near 22,550, off roughly 0.9%.

ING’s James Knightley notes that expectations for Federal Reserve easing in 2026 have been reduced as higher near-term US inflation and resilient growth make early rate cuts less likely.

OCBC strategists Sim Moh Siong and Christopher Wong highlight that recent US labour data and escalating Middle East tensions are supporting the Dollar.

Brown Brothers Harriman’s (BBH) Elias Haddad notes that the February NFP report will be crucial for assessing whether the US labor market is genuinely strengthening or if January’s strong gains were a one-off.

Deutsche Bank economists project a slowdown in February Nonfarm Payrolls to 30k from January’s 130k, with the Unemployment Rate steady at 4.3%.

Danske Research Team highlights that the key release is the US February jobs report, where they expect Nonfarm Payrolls to slow to 70k and unemployment to hold at 4.3%. Weekly jobless claims remain low and layoffs are easing, while productivity has cooled and unit labour costs have risen.

Commerzbank’s Volkmar Baur argues that the upcoming US labour market report is unlikely to shift expectations for Federal Reserve policy or materially reprice the Dollar.

The US Dollar (USD) is being supported by crude oil prices, which rose to its highest level since July 2024, amid headlines of potential interruptions to the Strait of Hormuz and attacks on vessels in the region.

ING’s Chris Turner notes that persistent geopolitical risks in the Middle East and elevated energy prices are supporting the Dollar. Turner expects DXY to drift towards the upper end of recent ranges, and highlights the concerns over US private credit.

Societe Generale analysts say macro data have been overshadowed by Middle East (ME) risks, with investors likely to seek safety in Dollar and Swiss Franc into the weekend absent de‑escalation.

TD Securities strategists Jayati Bharadwaj and Linda Cheng argue the US Dollar can behave like a safe haven again due to the nature of the current shock, even if it is no longer an effortless one.

The US Dollar (USD) eased on Wednesday after a two-day rally drove the US Dollar Index (DXY) near the 100.00 mark. The Greenback ignored the positive employment data and ISM Services PMI as the ongoing war between the US and Iran weights on sentiment.

The US Dollar Index (DXY) slipped about 0.18% on Wednesday, settling close to 98.90 after retreating from the 99.68 high printed earlier in the week.

Brown Brothers Harriman’s Elias Haddad notes the Dollar has retraced part of its recent surge but still benefits from short-term haven demand linked to Dollar funding needs. Rising cross-currency basis points to higher USD borrowing costs as stress lifts demand for short-term funding.

ING’s Chris Turner notes that US data, including ADP jobs, ISM services prices and the Fed’s Beige Book, could reinforce expectations of limited Fed easing in 2026. Turner doubts DXY will sustainably break above 100.35 without an improvement in energy markets.

DBS analyst Philip Wee argues that the recent surge in the Dollar Index (DXY) toward the 100 level looks overstretched after a 2% jump in two sessions.

The US Dollar (USD) is drawing safe-haven support amid sharply escalating tensions in the Middle East, prompting renewed investor concern.

The DXY jumped about 0.55% on Tuesday, rallying to around 99.09 and extending Monday's sharp move higher.

The Dow Jones Industrial Average (DJIA) dropped around 850 points, or 1.7%, to trade near 48,000 at midday Tuesday as escalating conflict in the Middle East sent shockwaves through global markets. The S&P 500 fell 1.62% to 6,770, while the Nasdaq Composite shed 1.72% to 22,357.

OCBC strategists note the Dollar has strengthened on safe-haven demand, positioning unwind and the divide between energy exporters and importers. They stress that the United States’ status as a net energy exporter and largest LNG exporter since early 2026 underpins USD resilience.

Dow Jones futures fall 1.26% to near 48,330 during European hours ahead of the US regular market open on Tuesday. S&P 500 and Nasdaq 100 futures decline 1.20% and 1.51% to near 6,800 and 24,650 at the time of writing.

Rabobank strategist Molly Schwartz highlights that the US Dollar’s strong performance reflects renewed safe-haven demand as geopolitical risks escalate around Iran.

The US Dollar Index (DXY), which measures the value of the US Dollar (USD) against six major currencies, steadied after registering nearly 1% gains in the previous session, trading around 98.50 during the Asian hours on Tuesday.

The United States, allied with Israel, struck Iran over the weekend, killing Iran’s Supreme Leader, Ayatollah Ali Khamenei.

The DXY jumped about 0.85% on Monday, surging through the 98.00 level to touch a session high around 98.75, its strongest reading in five weeks.

The Dow Jones Industrial Average is trading down around one-fifth of one percent at the time of writing. The S&P 500 is nearly flat, while the Nasdaq Composite has flipped green for the day.

ING’s Chris Turner argues Dollar strength after the Iran attack is justified and likely to persist. He highlights US energy independence versus Europe and Asia, and the risk that higher Oil and natural gas prices damage fossil-fuel importers.

Brown Brothers Harriman’s (BBH) Elias Haddad notes that the US-led military operation against Iran has driven a classic risk-off move, lifting the Dollar broadly while weighing on global equities.

TD Securities’ Global Strategy Team expects the US Dollar to benefit from safe-haven flows as markets react to the Iranian conflict. They anticipate that geopolitical risks will drive expectations for more Fed easing and note broad but measured Dollar buying in early trading.