Dollar drifts lower

The dollar fell against major currencies on Monday as hopes of a deal to ​reopen the Strait of Hormuz pushed oil prices below $100 per barrel, even as the US and Iran ‌played down the chances of reaching an agreement soon.

Meanwhile many global markets - including in the US, Hong Kong, the UK and the majority of Europe - are closed for holidays on Monday, thinning liquidity.

As diplomatic efforts to find a resolution to the Iran war continue, US Secretary of State ​Marco Rubio said there would either be a good agreement or Washington would deal with the country in “another way.”

Iran’s ​foreign ministry spokesperson said conclusions had been reached on many topics discussed in a potential memorandum of understanding with the US, but this did not mean Tehran was close to signing an agreement.

Oil markets tumbled on hopes of a peace deal, with Brent crude prices ​down 4.5 percent to $98.9 a barrel while US West Texas Intermediate was at $88.98 a barrel, off 4.4 percent.

Over the weekend, there ​were conflicting signs on a peace deal. US President Donald Trump said on social media on Saturday that a memorandum of ‌understanding on a peace deal with Iran had been “largely negotiated,” with both countries and mediators in Pakistan reporting progress.

However, on Sunday Trump said on Truth Social the US blockade on Iranian ships in the Strait of Hormuz would “remain in full force and effect until an agreement is reached, certified, and signed”.

“Markets have become conditioned to be incredibly patient on a tangible ​breakthrough, but the base case ​of a deal remains firm, with the weekend news providing further conviction, even if the timing remains unclear,” said Chris Weston, head of research at Pepperstone Group Ltd in Melbourne.