Rising oil prices dampened bets on a Federal Reserve rate cut, and the dollar strengthened.

The dollar strengthened against all major currencies as rising oil prices prompted swap traders to reduce their bets on a Federal Reserve rate cut this year. The inflationary impact of rising oil prices has led swap traders to now expect a Fed rate cut of about 59 basis points this year, up from 61 basis points on Friday. Gareth Berry, a strategist at Macquarie Group in Sydney, said this could be an early sign that the market believes the Fed's willingness to cut rates will decrease if oil prices continue to surge and eventually translate into higher inflationary pressures in the US. Deteriorating risk sentiment also contributed to the dollar's rise. S&P 500 futures fell 1.5% after Iran's national security chief said the country would not negotiate with the US. US President Trump said the bombing campaign against Iran would continue until its objectives were achieved and called on Iranian leaders to surrender. On Monday, the dollar was one of the few traditional safe-haven assets to rise, besides gold, while US Treasuries, the yen, and the Swiss franc all fell. (Jinshi)