Currency market on tenterhooks as Iran war weighs on sentiment

The dollar held its ground on Wednesday as traders moved to the sidelines, awaiting cues on what comes next in the U.S.-Israeli war with Iran while mixed messages on a resolution to the conflict kept sentiment frail. Global markets have been betting that U.S. President Donald Trump will seek to end the conflict soon, but Trump has also repeatedly threatened to hit Iran hard over moves to stop the flow of energy supplies through the Strait of Hormuz. The dollar, which has surged as the more than week-long war sent oil prices soaring, has given up some of those gains on hopes of a swift resolution, but analysts remain sceptical of the conflict ending so soon. “We expect the war to run for months, not weeks, while acknowledging the high level of uncertainty,” said Kristina Clifton, senior currency strategist at Commonwealth Bank of Australia.