The US Dollar pared losses after a sharp drop on Thursday (6/13). Risk-off reaction to Israel's attack on Iran has brought some cheer to the US Dollar, pushing the pair back above 0.8100, but it is still on track for a weekly decline of 1.3%.

News reports of explosions at nuclear and military sites in Iran that would kill several high-ranking Revolutionary Guard figures in an attack that, according to Israeli Prime Minister Benjamin Netanyahu, could last for several days.

Iran announced that it would walk away from nuclear talks with the US, which took place on Sunday in Oman, and launched a drone attack on Israel, which was intercepted by the Israeli army.

The incidents have raised concerns about a regional war in the region, which would add another layer of uncertainty to the already gloomy global economic outlook, after Trump threatened to impose unilateral tariffs on all trading partners if they do not comply with a series of demands that the administration will send out in the coming days.

The US dollar has been the best beneficiary of the risk-off sentiment. The USD/CHF pair pared losses after hitting just above a 14-year low, at 0.8045. However, the broader trend remains bearish, with the Swiss franc's downside attempts likely to be limited in risk-averse markets. (alg)

Source: FXstreet