Finance
Dollar Drops as Trump Ceasefire Prompts Risk-On Turn for Markets
Published by Global Banking & Finance Review®
Posted on April 7, 2026
2 min readLast updated: April 8, 2026
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Markets rallied in Asia on April 8, 2026 after President Trump agreed to a two‑week ceasefire with Iran, sending the dollar to two‑week lows and igniting strength across G10 FX, equities, oil and crypto.
Dollar Falls to Two-Week Low After Trump Ceasefire Spurs Market Rally
Market Reactions to Trump-Iran Ceasefire Announcement
By Gregor Stuart Hunter
Dollar Weakness and Currency Movements
SINGAPORE, April 8 (Reuters) - The dollar sank to its lowest level in two weeks at the start of trading in Asia on Wednesday, while the euro, yen, Aussie and kiwi rallied hard after U.S. President Donald Trump said he had agreed to a two-week ceasefire with Iran.
Major Currency Performance
The yen strengthened 0.6% against the greenback to 158.68 yen per dollar. The euro was up 0.7% at $1.167, while the British pound appreciated 0.7% to $1.3385. The Australian dollar climbed 1.3% to $0.7068 as its New Zealand counterpart jumped 1.4% to $0.5810.
Background and Market Sentiment
Trump's Threats and Market Turnaround
Trump had earlier threatened widespread attacks on Iran's civilian infrastructure. Markets turned risk-on after the announcement, less than two hours before his deadline for Tehran to reopen the Strait of Hormuz expired.
U.S. Dollar Index and Cryptocurrency Rally
The U.S. dollar index, which measures the greenback's strength against a basket of six currencies, was down 1.0% at 98.97, a two-week low. Cryptocurrencies also rallied, with bitcoin advancing 3.4% to $71,664.41, as ether surged 5.7% to $2,234.78.
(Reporting by Gregor Stuart Hunter in Singapore; Editing by Matthew Lewis)
Key Takeaways
- •Trump’s agreement to a two‑week ceasefire with Iran triggered a sharp dollar sell‑off and boosted risk‑on sentiment globally (apnews.com)
- •The U.S. Dollar Index fell about 1% to 98.97, while G10 currencies including the euro, yen, Aussie and kiwi rallied notably (axios.com)
- •Cryptocurrencies surged, with Bitcoin up over 3% around $71,600 and Ether rising nearly 6%, reflecting renewed appetite for risk assets (axios.com)
References
Frequently Asked Questions about Dollar drops as Trump ceasefire prompts risk-on turn for markets
1Why did the dollar fall at the start of Asian trading?
The dollar dropped as markets responded to President Trump's announcement of a two-week ceasefire with Iran, which led investors to take on more risk.
2Which currencies rallied against the dollar after the ceasefire announcement?
The euro, yen, British pound, Australian dollar, and New Zealand dollar all strengthened sharply against the U.S. dollar.
3How did the U.S. dollar index react to the ceasefire news?
The U.S. dollar index fell by 1.0% to 98.97, its lowest level in two weeks.
4How did cryptocurrencies respond to the market shift?
Bitcoin advanced 3.4% to $71,664.41 and ether surged 5.7% to $2,234.78 after the market turned risk-on.
