Dollar-yen fell to 158.60 in New York trading on the 12th before rebounding to close at 159.54, as an initial dollar selloff after July U.S. core CPI matched forecasts at 2.5% year over year gave way to renewed buying tied to oil and geopolitical risk. The core reading, which excludes food and energy, marked the slowest pace since the start of the year and tempered expectations of an early Federal Reserve rate hike. Later in the session, harder-line signals from Iran reduced expectations for progress in U.S.-Iran talks over the Strait of Hormuz (a vital oil shipping chokepoint), helping keep crude prices elevated and lifting the dollar off its lows. Euro-dollar rose to $1.1563 before falling to $1.1520, euro-yen slipped to 183.44 yen before rising to 183.83 yen, pound-dollar climbed to $1.3543 before falling to $1.3490, and dollar-Swiss franc fell to 0.8096 francs before rising to 0.8139 francs. NY crude oil futures extended gains despite a brief dip after U.S. inventory data unexpectedly showed a build, as comments from a new senior adviser to the commander of Iran's Islamic Revolutionary Guard Corps, or IRGC (Iran's elite military force), fueled concerns that Middle East supply risks could persist. U.S. headline CPI rose 0.1% month over month and 3.4% year over year in July, while the fiscal balance showed a deficit of $432.3 billion, wider than the $346.0 billion forecast. Market participants increasingly see stabilizing U.S. inflation being offset by geopolitical risks as a fresh driver of volatility.