Dollar pulls back as US-Iran attacks pause, oil drops

SINGAPORE: The dollar slumped ​against its major peers in ​Asian trading on Monday after the U.S. paused its bombing campaign in Iran during the weekend, prompting a drop in oil prices and boosting global investor confidence. 
Against the yen, the U.S. dollar was down 0.2% at 163.585 yen, its biggest decline since July ⁠10. The euro was up 0.3% at $1.1403, while the British pound ⁠rose 0.2% to $1.3352. Oil prices sank in early Asian trade, with Brent crude tumbling 4.2% to $92.74 after the U.S. military temporarily halted its two-week-long strikes. 
Iran will halt ‌its own attacks as long as the ​U.S. does the ⁠same, a senior Iranian official told Reuters on Sunday, following ​a China-led push to resume stalled ‌diplomatic efforts in Pakistan to end the war. 
'Markets remain on edge around the U.S.-Iran ​conflict and the path of oil prices,' MUFG analysts wrote in a research report. 'While it is difficult to know for sure how things will pan out, our base case remains for de-escalation over time for several reasons and as such for ‌oil prices to decline.' 
In other major currencies, the New Zealand ​dollar was 0.1% higher at $0.5791, while its Australian counterpart was up by the ​same ‌magnitude ⁠at $0.6996. 
The U.S. dollar index, which measures the greenback's strength against a basket of six currencies, was flat at 101.21 at the start of a week ​packed with central bank meetings, including that of the ⁠Federal Reserve. 
Traders' ​bets that the Federal Reserve could raise interest rates at its upcoming policy meeting eased a little compared to last week.

Fed funds futures are pricing an implied 33.7% probability of a 25-basis-point hike at the next ​two-day meeting ending on Wednesday, down from 37.4% on Friday, ​according to the CME Group's FedWatch tool. In cryptocurrencies, bitcoin was up 1% at $65,286.74, while ether climbed 1.7% to $1,945.22.