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The U.S. military is brewing a ground war, and the U.S. dollar index returns to the 100 mark
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Hello everyone, today XM Forex will bring you "[XM Forex Official Website]: The US military is brewing a ground war, and the US dollar index returns to the 100 mark." Hope this helps you! The original content is as follows:
On March 30, in early trading in the Asian market, spot gold was trading around US$4,483 per ounce. Although the price of gold rose last Friday due to bargain hunting, as the situation in the Middle East became tense again over the weekend, and the Houthi armed forces joined in the attack on Israel, the price increased. Uncertainty risks, the market has xmaccount.completely ruled out the possibility of a U.S. interest rate cut in 2026; U.S. crude oil opened up more than 2% on Monday, trading around $102.23 per barrel. The Israeli military said over the weekend that it had attacked Iran’s temporary xmaccount.command center, and the Pentagon may be preparing for several weeks of ground operations in Iran.
The U.S. dollar index rose last Friday, recording its largest monthly gain in nearly a year, driven by safe-haven demand; the war in the Middle East escalated and hopes of easing the situation faded. At the same time, rising market expectations for U.S. interest rate hikes this year also supported the U.S. dollar.
The U.S. dollar index rose 0.3% to 100.17. It has risen 2.57% so far in March and is expected to have its best monthly performance since July 2025. The Japanese yen has been particularly under pressure, falling 0.34% against the US dollar to 160.35 yen, falling below the 160 mark for the first time since July 2024, increasing the possibility of Japanese authorities intervening in the currency market; the yen has fallen 2.74% this month, and Japan's high dependence on imported energy makes it more susceptible to price increases than many major economies.
In terms of market sentiment, Iran is expected to make a counter-proposal to the US ceasefire proposal on Friday. US Secretary of State Rubio said that the war is expected to last weeks rather than months and does not require ground troops. However, the Iranian Revolutionary Guard reiterated that it will ban all ships related to US and Israeli allies from passing through the Strait of Hormuz.
The Wall Street Journal reported that the Pentagon is considering sending up to 10,000 additional ground troops to the Middle East to further extinguish the war in the short term.Hope of closure. The U.S. consumer confidence index fell to a three-month low in March as the war pushed up oil prices and weighed on the economic outlook.
In other currencies, the euro fell 0.17% to US$1.1509, and the pound fell for the fourth consecutive day, down 0.48% to US$1.3268. The risk-sensitive Australian dollar fell 0.2% to US$0.687, hitting a two-month low during the session. It has depreciated about 3% since the outbreak of the war, and is only better than the Indian rupee (down 5.37%) among major currencies.
In terms of interest rate expectations, federal funds rate futures have xmaccount.completely reversed previous predictions of another interest rate cut this year, and market speculation has shifted to an interest rate hike; the Bank of England and the European Central Bank are also expected to tighten policies, hitting the bond market hard this month and pushing yields to multi-year highs.
Asian Markets
Bank of Japan (BoJ) Governor Kazuo Ueda said during the Asian trading session on Monday that changes in the foreign exchange market are a key factor that has a huge impact on Japan's economy and prices after the central bank issued a "Summary of Opinions."
European market
UK retail sales fell 0.4% month-on-month in February, partially reversing January's strong 2.0% month-on-month growth as previous discount-driven consumption weakened. The pullback suggests consumers are delaying purchases into January to take advantage of promotions, leading to weaker activity next month.
The decline was led by supermarkets, whose sales fell after rising in January. Non-bricks and mortar retailers also reported weak activity, reinforcing the view that demand is temporarily improving rather than a structural improvement.
Despite the monthly decline, the overall trend remains mildly positive. Retail sales rose 0.7% in the three months to February 2025 xmaccount.compared with the three months to November 2025, supported by stronger non-physical retail activity and a rebound from weak November levels.
US Markets
Federal Reserve officials are signaling a shift in priorities, with the labor market increasingly seen as "balanced" and inflation risks resurfacing. xmaccount.comments by Philip Jefferson, Michael Barr and Lisa Cook highlight a subtle but important shift away from the primary focus on employment and toward rising price pressures triggered by energy shocks in the Middle East.
Vice Chairman Jefferson said he expected headline inflation to rise in the near term, reflecting rising energy prices caused by the conflict. He stressed that the duration of the shock was crucial - a brief disturbance might only affect the economy for a quarter or two, but a sustained rise in oil prices could have a more material impact on inflation and growth.
Governor Barr added that the key risk is a shift in "inflation expectations," which could lead to more entrenched price dynamics. He stressed how important it is to assess how long energy prices remain high, with longer-term shocks posing a greater threat to inflation and the broader economy.
Additionally, Governor Cook further reinforced this message, stating that while overall risks are balanced, inflation risks are “currently greater: this signals a clear focus.”In a clear shift, policymakers are prioritizing curbing inflation rather than dealing with potential weakness in growth.
At the same time, the labor market is seen as "balanced." Officials noted that hiring is low-risk and low-risk, and that while employment conditions are currently stable, they could weaken if the shock intensifies.
Overall, the xmaccount.comments reflected a return to caution about inflation. Rate cuts have been delayed, and while policy is on hold, the balance of risks has shifted.
The above content is all about "[XM Foreign Exchange Official Website]: The US military is brewing a ground war, and the U.S. dollar index has returned to the 100 mark". It is carefully xmaccount.compiled and edited by the editor of XM Foreign Exchange. I hope it will be helpful to your trading! Thanks for the support!
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