The euro fell against a basket of major currencies in European trading on Wednesday, extending its losses for a second consecutive session against the US dollar as investors sought the greenback as a preferred safe-haven asset amid renewed military tensions between the United States and Iran in the Strait of Hormuz.

The renewed rise in global oil prices has also revived concerns about inflationary pressures on central banks, reinforcing expectations that interest rates could remain higher or increase further in the coming months.

The Price

Euro today: The euro fell 0.1% against the US dollar to $1.1399, down from the session opening level of $1.1412. It recorded an intraday low of $1.1413.

The euro closed Tuesday down 0.25% against the US dollar, its first daily decline in four sessions, as traders continued profit-taking following its rally to a two-week high of $1.1473.

US dollar

The US Dollar Index rose 0.1% on Wednesday, extending gains for a second straight session as the US currency strengthened against a basket of major and minor currencies.

The dollar continued to benefit from safe-haven demand following the renewed military confrontation between the United States and Iran, raising concerns that the ceasefire agreement could collapse and peace negotiations could come to an end.

Later today, markets will closely watch the minutes of the Federal Reserve's first monetary policy meeting under Chairman Kevin Warsh, which are expected to provide fresh clues about the likelihood of further US interest rate hikes this year.

Global oil prices

Oil prices climbed around 0.5% on Wednesday, extending gains for a second consecutive day and reaching their highest level in two weeks amid renewed concerns over potential supply disruptions through the Strait of Hormuz and the risk of further interruptions to maritime traffic.

Iran conflict developments

The United States launched a large-scale wave of airstrikes targeting more than 80 military sites across Iran, including locations in Bandar Abbas, Sirik, and Qeshm Island in the country's south.

The strikes came after Iran's Islamic Revolutionary Guard Corps attacked three commercial oil tankers, including a Qatari LNG carrier and another vessel flying the Saudi flag, while they were transiting the Strait of Hormuz.

Tehran claimed the vessels had failed to follow "Iran-approved shipping routes" and attempted to use lanes closer to Oman to avoid transit fees that Iran has been seeking to impose.

The US Treasury officially revoked a temporary license that had allowed Iran to produce and export crude oil, describing the maritime attacks as a clear violation of the memorandum of understanding signed on June 17.

Iran vowed a "decisive and powerful response" to the US strikes, while Foreign Minister Abbas Araghchi said no final negotiations could take place as long as threats and military attacks continued.

Pakistan had been scheduled to host another round of technical talks between the United States and Iran on July 11 to discuss sanctions relief, the release of frozen assets, and Iran's nuclear program.

US President Donald Trump reiterated that Washington would either reach a final agreement with Iran or "finish the job" through comprehensive military action.

European interest rates

European Central Bank President Christine Lagarde said last week at the ECB Forum in Sintra that risks to inflation and economic growth in the euro area have become more balanced than they were a few weeks ago following the recent decline in oil prices.

Money markets are currently pricing the probability of a 25-basis-point ECB rate hike in July at around 10%.

Investors will continue monitoring upcoming eurozone data on inflation, employment, and economic growth to reassess the outlook for European monetary policy.