Dollar on track for strongest monthly gain in nearly a year as Gulf tensions and rate-hike bets persist

The US dollar is positioned to record its largest monthly gain in almost 12 months, with the currency index on track for a 2.5% advance in June.

The move marks the strongest performance since July of last year, fueled by a combination of geopolitical risk and shifting monetary policy expectations.

3198 and was down 2% for the month, reflecting the broad-based strength of the greenback.

Sterling traded 0.1% lower at $1.3198 and was down 2% for the month, reflecting the broad-based strength of the greenback.

The dollar's rally has been underpinned by intensifying market expectations that the Federal Reserve may need to raise interest rates rather than cut them, reversing the dovish bias that had characterized much of the year.

Gulf tensions have also provided a tailwind, as investors seek safe-haven assets amid rising geopolitical uncertainty.

The convergence of hawkish Fed bets and risk-off sentiment has created a powerful bid for the dollar, with the currency index climbing steadily through the month.