The dollar index rose to a one-year high on Thursday, extending gains made on hawkish interpretations of Fed Chair Kevin Warsh's first policy meeting, to about 1.3%.

U.S. data did little to undermine the rally, with weekly jobless claims easing more or less as expected, though continued claims rose more than expected.

The Philly Fed business index rebounded slightly more than expected, with employment, prices paid and new orders all rising. The Conference Board's Leading Economic index came in as expected with a slight revision higher. Some 12.5 million barrels of crude sailed through the Strait of Hormuz overnight, U.S. Vice President JD Vance said, but in Lebanon, Israeli forces launched fresh airstrikes early on Thursday, potentially raising some doubts about the path to permanent peace.

The Bank of England kept interest rates on hold at 3.75%, as it has since the start of the U.S.-Iran war, judging it would be premature to raise rates now given uncertainty about the strength of increased inflation pressures. GBP/USD softened on dovish interpretations of the BoE's decision to hold rates steady and event risk as the northern English area of Makerfield voted in a local election that could return Greater Manchester Mayor Andy Burnham to parliament, paving the way for him to launch a bid to take over as prime minister. AUD/USD managed to overcome the robust U.S. dollar with the help of yen sales that propelled AUD/JPY higher. EUR/USD hit a 2-1/2-month low of 1.1454, with techs leaning bearish. USD/JPY surged past 161 to a 2026 high at the London close as U.S. shares advanced.

The S&P 500 was trading 1.04% higher in New York afternoon with semiconductor shares leading gains as optimism about a Middle East peace deal offset worries about a hawkish Federal Reserve under new Chair Kevin Warsh.

WTI crude oil fell 0.7%, touching its lowest since early in the Iran war as the interim deal to end fighting and reopen the Strait of Hormuz boosted the global supply outlook.

Copper was down 1.52% and gold fell 0.78%, both undermined by the stronger dollar.

Heading toward the close: EUR/USD -0.32%, USD/JPY +0.48%, GBP/USD -0.66%, AUD/USD +0.06%, =USD +0.45%, EUR/JPY +0.18%, GBP/JPY -0.13%, AUD/JPY +0.54%.(Robert Fullem)