[MARKET ANALYSIS] DXY is marginally firmer after following the geopolitical escalation over the weekend

DXY: +0.1%

• Mildly strengthened amid firmer oil prices and the initial risk-off mood due to the geopolitical escalation over the weekend, although various asset classes have since pared a lot of the moves as attention turns to potential US-Iran talks early this week in Islamabad ahead of the Tuesday ceasefire deadline.

EUR/USD: Flat

• Dipped at the start of trade but then gradually returned to flat territory, while the indecisive performance also follows last Friday's whipsawing and with little impact from recent central bank rhetoric, including from ECB’s Demarco, who said market bets on two rate hikes are not unreasonable.

GBP/USD: -0.1%

• Mildly weakened and briefly dipped beneath the 1.3500 handle before nursing most of the losses, but with the upside limited as UK PM Starmer faces further political headwinds and increased calls to step down, as reports noted that Starmer knew about Mandelson's red flags.

USD/JPY: +0.2%

• Momentarily reclaimed the 159.00 level amid the early flows into the dollar and rising oil prices, but then faded some of the moves as the initial market reactions to the weekend geopolitical headlines moderated.

Antipodeans: AUD/USD -0.2% / NZD/USD -0.1%

• Declined amid the initial spooked reaction to the geopolitical developments from over the weekend, but then clawed back nearly all of the initial losses as Asia-Pac participants ultimately shrugged off the recent escalatory headlines.