US dollar posts strongest day in two weeks as Strait of Hormuz tensions revive safe-haven demand

The US dollar recorded its biggest daily gain in two weeks on Aug. 6 as renewed disruption fears in the Strait of Hormuz drove a fresh safe-haven bid and revived concern over energy-driven inflation. The Bloomberg Dollar Spot Index rose 0.2%, its largest one-day advance since July 23, after reports that Iran was attempting to restrict US and Israeli vessels from passing through the waterway, a critical route for global oil supply. Oil prices climbed on the reports, while US 10-year Treasury yields also moved higher as investors priced in a larger inflation-risk premium tied to elevated energy costs. The dollar's strength was especially visible against the Japanese yen, rising 0.5% to about 158.55 and moving above its 200-day moving average. The move extends a broader trend rather than marking an isolated session. The dollar has gained 1.5% since US military actions against Iran began in late February 2026, as disrupted energy flows and heightened geopolitical risk have reshaped market positioning. Second-quarter US labor productivity growth also provided fundamental support for the currency. Traders are now focused on upcoming US payroll data and remarks from Federal Reserve officials. The combination of higher oil prices and a stronger dollar may also deepen strains on emerging market economies that fund oil imports in dollars, increasing pressure on current accounts, currencies and capital flows.