The dollar index rose 0.38% on Monday after the United States announced a naval blockade of Iranian ports, sending the greenback higher against every major currency in a pattern that has repeated itself with almost mechanical regularity since the war began on February 28. [1]

The euro fell 0.3% to $1.1694. The British pound dropped 0.2% to $1.3429. The risk-sensitive Australian dollar shed 0.3% to $0.7052. Brent crude, meanwhile, climbed back above $101 per barrel — the energy shock and the currency move feeding each other in a loop that seven weeks of war have made entirely predictable. [1]

The trigger was the collapse of nearly 20 hours of ceasefire talks in Islamabad over the weekend. President Donald Trump announced Sunday that the U.S. Navy would begin blockading the Strait of Hormuz after negotiations failed to produce a deal, with U.S. Central Command confirming enforcement would begin at 10 a.m. ET Monday against all maritime traffic entering or exiting Iranian ports. [1]

Tommy von Brömsen, foreign exchange strategist at Handelsbanken, told Reuters the dollar benefited from the flare-up but cautioned the gains were muted compared to earlier spikes in the conflict. "What we're seeing this morning is positive for the dollar, but we're not seeing the large movements that we saw earlier in the war," he said, adding that the U.S. government's "inability to conduct sound policy could start to push investors away from the U.S. currency." [1]

The dollar has tended to strengthen when U.S.-Iran tensions escalate, owing to its safe-haven status and America's limited exposure to imported energy-price inflation as a net petroleum exporter. Commodity Futures Trading Commission data released Friday showed speculators raised their net long positions on the dollar for the second consecutive week, with the net position in the euro flipping short for the first time since March of last year. [1]

CNBC's analysis noted a muted stock reaction — the S&P 500 was virtually unchanged by midday — suggesting investors are increasingly pricing geopolitical shocks as temporary disruptions rather than structural threats. The pattern has been consistent since mid-March: oil spikes, the dollar climbs, equities shrug, and the cycle resets until the next headline. [2] Whether that complacency survives an actual blockade enforcement remains the open question heading into Tuesday's Asian session.

-- THEO KAPLAN, San Francisco