The warming situation in the Middle East drives up demand for safe-haven, and the US dollar index approaches a new high for the year

On October 7, the dual factors of the escalation of the situation in the Middle East and rising oil prices combined, pushing investors to accelerate their shift to safe-haven assets, and the US dollar strengthened significantly on Wednesday. Against the backdrop of more Iranian attacks on ships in the Strait of Hormuz, the increase in the U.S. dollar index DXY once expanded to 0.5%. Its trend rose in sync with oil prices and was close to the annual peak. In the G10 monetary system, all currencies except the US dollar depreciated against the US dollar. The exchange rate of the euro against the US dollar fell particularly significantly, becoming the weakest performing major currency. Catherine Brooks, head of research at XTB, pointed out in an analysis report that the US dollar is serving as a countercyclical safe-haven asset and becomes a safe haven for funds when other asset classes encounter sell-offs. (Jin Shi)