USD Index Edges Higher on Fed Uncertainty and Middle East Tensions

The US Dollar Index recorded a mixed but slightly firmer performance against major currencies during the week ended July 10, as traders navigated competing forces of Federal Reserve monetary policy uncertainty and renewed safe-haven demand sparked by Middle East conflict escalation. The dollar benefited from its safe-haven status amid geopolitical tensions, but gains were capped by unclear signals regarding the Fed's next rate move, leaving market participants divided on the trajectory of US interest rates. EUR/USD and GBP/USD faced intermittent selling pressure as risk sentiment deteriorated, while USD/JPY saw two-way flows as both currencies attracted haven bids. The Dollar Index found support near recent lows but lacked conviction for a decisive breakout higher. Traders are closely watching upcoming US inflation data and Fed commentary for directional clarity. Near-term resistance on the DXY sits at the weekly highs, while a break lower could signal broader dollar softness. Positioning remains cautious ahead of key macro catalysts.