The US dollar is trading near its highest level in a month, driven by a surge in safe-haven flows following a fresh escalation of hostilities in the Middle East.
Investors are positioning defensively as geopolitical risks intensify, providing a counterweight to the currency's recent weakness.
This defensive buying comes as global markets await a critical interest rate decision from the Federal Reserve later this week.
The central bank's policy stance will be closely scrutinized for signals on the future path of monetary policy, particularly regarding the timing and pace of potential rate adjustments.
The dollar's resilience marks a shift from earlier in the week, when the currency index was on track for a weekly decline.
That downward pressure had been fueled by softer-than-expected US inflation data, which led traders to recalibrate their expectations for Fed easing.