US dollar rallies as Treasury moves to cut Iran off from global finance

The dollar rallied after Treasury Secretary Scott Bessent said the United States would cut Iran off from the global financial system, Bloomberg reported.

The Bloomberg Dollar Spot Index rose about 0.2%, gaining against all Group of 10 currencies in its strongest session in two weeks. Bessent also warned that countries doing business with Iran could face US sanctions.

The move reversed some of the dollar’s recent weakness. The currency had fallen after the Treasury announced larger bond buybacks and as concerns about the US fiscal outlook weighed on sentiment.

The dollar’s rebound came as investors reassessed the potential impact of the Iran measures. A Monex foreign-exchange trader said the threat of exclusion from the dollar system was driving haven demand.

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