U.S. $100 bills. Photo: Wikimedia Commons.

A fragile calm reigned across currency markets on Thursday as traders kept their eyes fixed on whether the ceasefire between the US and Iran would hold, a day after its announcement sent the dollar tumbling across the board.

The deal appeared to be on thin ice, as Israel bombed more targets in Lebanon, and there was no sign Iran had lifted its blockade of the Strait of Hormuz, which has caused the worst disruption to global energy supplies in history.

Iranian negotiators were expected to set off later on Thursday for Pakistan for the first peace talks of the war, but Tehran said there would be no deal as long as Israel was striking Lebanon.

President Donald Trump said all US ships, aircraft, and military personnel would stay in place in and around Iran until it fully complied with a deal.

The uncertainty left currency markets on edge.

The euro was up 0.17 percent at $1.1683. It had gained 0.6 percent on Wednesday, but retreated late in the day having touched a one-month high of $1.1721 earlier in the session.

Sterling similarly was 0.21 percent higher at $1.342, after gaining 0.77 percent on Wednesday, but retreating from as high as $1.348.

Meanwhile, the Japanese yen lost some ground, with the dollar up 0.3 percent at 159.055 yen, having briefly dropped below 158 on Wednesday.

With the Strait of Hormuz closed, “the entire ceasefire remains tenuous,” said Derek Halpenny, head of research global markets EMEA at MUFG. But, he added, “while the US dollar has rebounded, the moves in general have been modest.”

He said the fact that further talks scheduled in Pakistan were still going ahead was keeping any retracement of Wednesday’s moves in check.

Elsewhere, new personal spending data released on Thursday showed that US inflation increased as expected in February and likely rose further in March amid the war with Iran, a trend that is expected to discourage the Federal Reserve from cutting interest rates for a while.

The personal consumption expenditures price index ​climbed 0.4% after an unrevised 0.3 gain in January, the Commerce Department’s Bureau of Economic Analysis said ‌on Thursday.

Japan’s consumer confidence worsened in March for the first time in three months, a government survey showed on Thursday, adding to a recent string of data pointing to the potential economic hit from the Middle East war, which would complicate the Bank of Japan’s rate-hike decision. The yen showed little reaction to the data.

Speaking in parliament, BOJ Governor Kazuo Ueda said real interest rates were clearly negative and were keeping the country’s financial conditions accommodative.

Other currencies were also broadly steady. The Australian dollar was 0.15 percent higher at $0.7054, while the New Zealand dollar was 0.46 percent higher at $0.585. In cryptocurrencies, bitcoin was last down 0.97 percent at $70,680.

FILE PHOTO: Israeli opposition leader Yair Lapid delivers a statement at the Knesset, Israel’s parliament,, in Jerusalem, February 13, 2023. REUTERS/Amir Cohen/File Photo

i24 News – Israeli opposition leader Yair Lapid on Wednesday launched a sharp attack on the ceasefire agreement reached between the United States and Iran, calling it a “political disaster” and directly blaming Prime Minister Benjamin Netanyahu.

In a post on X, Lapid said the agreement sidelined Israel from critical decisions affecting its national security. “Never in our entire history have we experienced such a diplomatic disaster,” he wrote, adding that “Israel wasn’t even at the table when decisions were made regarding the core of our security.”

Lapid accused Netanyahu of failing to translate military achievements into strategic gains, despite praising the performance of the Israeli military and the resilience of the public during the conflict. “The army has accomplished everything that was asked of it, and the citizens have shown remarkable strength,” he said.

However, he argued that those efforts were not matched by political leadership. “Netanyahu has failed politically, failed strategically, and has not achieved any of the goals he set for himself,” Lapid added.

The opposition leader also warned of long-term consequences stemming from the agreement, saying the fallout could take years to repair. He criticized the government’s handling of the crisis, citing what he described as “arrogance, negligence, and a lack of strategic vision.”

A map showing the Strait of Hormuz is seen in this illustration taken June 22, 2025. Photo: REUTERS/Dado Ruvic/Illustration

Imposing a toll on ships sailing through the critical Strait of Hormuz would “set a dangerous precedent” and countries should not impede freedom of navigation, the UN’s shipping agency said on Thursday.

Iranian officials have raised the idea of charging a toll for using the Strait after a two-week ceasefire between the United States and Tehran was agreed this week.

“There is no international agreement where tolls can be introduced for transiting international straits. Any such toll will set a dangerous precedent,” a spokesperson with the UN’s International Maritime Organization said.

IMO countries adopted the UN Convention on the Law of the Seas, or UNCLOS, which outlines the rules that govern straits used for international navigation.

“According to UNCLOS, ships enjoy the right of transit passage through international straits. States bordering straits shall not hamper that right or suspend the transit passage,” the IMO spokesperson said.