As the peace talks between Iran and the U.S.?broke up and the U.S. The Navy was preparing a?blockade of?Iranian port.

The euro fell by 0.3% to $1.1684, and the British pound dropped 0.5% to £1.3398. The Australian dollar, which is a risky currency, was down 0.6% at $0.7030. Meanwhile the New Zealand Dollar was off 0.4% to $0.5816.

Donald Trump, the U.S. president, said that the U.S. Navy will begin blocking the Strait of?Hormuz on Sunday after marathon talks failed to produce a peace agreement with Iran. This would?threaten a fragile ceasefire of two weeks. U.S. Central Command announced that U.S. Forces would start implementing a blockade of all maritime traffic entering or leaving Iranian ports at 10 a.m. ET (1400 GMT), on Monday.

Analysts from 'Westpac' wrote that the 'early and thin FX trade?this morning demonstrates a risk off mood with a broad-based rally of the USD as a response.

After 16 years of nationalist rule, veteran leader Viktor Orban was ousted from power by the centre-right Tisza Party in Sunday's elections.

The dollar rose 1.8%, to 314.89, the highest level since January. The euro, meanwhile, rose 2.2%, to its highest level in four years.

Goldman Sachs analysts wrote in a report that "Hungarian assets reacted positively" to the news, partly because it implied that EU funds would be released?fully and relatively quickly into Hungary. "EU funds in the current budget for 2021-27 account for approximately 3% of GDP each year. Nearly half are currently frozen." The U.S. dollar index, which measures greenback strength against a basket six currencies, remained at 99.056, close to its highest level since April 7.

The U.S. Dollar was up 0.4% against the?yen at 159.83, as the yields on Japan’s 10-year benchmark government bonds rose 5.5 basis points, to 2.49%. This is the highest level for almost 30 years. (Reporting and editing by Gregor Stuart Hunter, Sonali Paul, and Kevin Buckland).

(source: Reuters)