Dollar shaky as investors weigh rate outlook, Middle East worries

The US dollar wobbled on Thursday as new US strikes in the ​Middle East undermined sentiment, while a surge in May US consumer inflation to a three-year high kept investors uneasy about the Federal ‌Reserve’s monetary policy outlook. The currency markets have been subdued this week, as investors weighed the fragile ceasefire in the Middle East against a renewed cycle of tit-for-tat strikes between the US and Iran, eroding hopes for a near-term peace agreement. The euro bought $1.1553, inching away from the 10-week low it hit last week, but has given up most of its ​gains since a ceasefire was struck in early April. The spotlight will be on the European Central Bank policy meeting later in the ​day as it looks poised to raise rates to tackle inflation.