The US dollar moved near its lowest levels in a month on Tuesday, with investors cautious about tensions between the United States and Iran, and anticipating the results of the US midterm elections, while the Australian dollar fell following the decision of the Central Bank of Australia to raise interest rates as expected.
In energy markets, oil prices rose slightly during early Asian trading, as Brent crude futures rose 0.5 percent to $105.25 per barrel, recovering part of the losses of more than 7 percent recorded on Monday.
This rise came after the United States carried out strikes that it described as “defensive” on the Iranian island of Qeshm, which limited the optimism that prevailed in the markets earlier regarding talks between the two sides to reach a settlement to end the war that has been ongoing for eight months.
At the same time, the decline in shares of artificial intelligence companies showed no signs of abating, which weakened investors' appetite for risk and provided some support to the dollar. Concerns surrounding the US midterm elections also contributed to enhancing the currency's appeal as a safe haven.
The dollar index, which measures the performance of the US currency against a basket of major currencies that includes the euro and the yen, rose slightly to 101.81 points, after falling on Monday to its lowest level in a month.
Sim Moh Siong, foreign exchange strategist at OCBC Bank, said in a research note that the decline in energy prices is reshaping the dynamics of currency markets, while fears related to artificial intelligence and the risks of the US elections reinforce expectations that the dollar will continue to receive support.
Among other factors that supported the US currency, the Chinese yuan declined in foreign markets, heading towards recording its largest daily decline since May, after it fell by 0.34 percent to 6.67 yuan against the dollar.
This decline came after the People's Bank of China announced an increase in the mandatory foreign exchange reserve ratio, in a move that would tighten the liquidity available in dollars and slow the pace of the Chinese currency's recent gains.
On the other hand, the euro stabilized at $1.1182, while the Japanese yen recorded 157.92 against the dollar, with trading largely stable due to an official holiday in Japan.
A new round of central bank decisions
This week, markets are awaiting monetary policy decisions issued by a number of central banks, including Australia, Britain, Norway, and Sweden.
On Tuesday, the Reserve Bank of Australia raised its key interest rate by 25 basis points to 4.85 percent, as markets had expected, reaching its highest levels since December 2008.
Thus, the total increases approved by the bank during the current year, through five decisions, reach 125 basis points.
Investors had strongly suggested raising interest rates, after monetary policy makers warned of upward risks to core inflation, which reached 3.7 percent, exceeding the central bank’s target range of between 2 and 3 percent.
Despite the decision to raise interest rates, the Australian dollar fell by 0.35 percent to 0.6974 US dollars, following the announcement of the decision. The New Zealand dollar settled at $0.5616.
In Britain, the pound sterling stabilized at $1.3401, after the latest PMI data showed that British factories began the last quarter of 2026 with the strongest production growth in more than two years.
Economists polled by Reuters expect the Bank of England to raise the key interest rate to 4 percent, compared to 3.75 percent currently, in the first increase since August 2023, when inflation was exceeding three times the bank’s target of 2 percent.
Saudi Aramco announced an increase in its adjusted net income during the third quarter of 2026 by 9 percent on an annual basis, to reach 117 billion riyals ($31.2 billion), compared to 107.2 billion riyals ($28.6 billion) in the corresponding period of last year, supported by operational excellence, the flexibility of the company’s business, and its ability to quickly restore operations in the face of challenges.
Cash flows from operating activities rose to 145.2 billion riyals ($38.7 billion), compared to 135.4 billion riyals ($36.1 billion) in the third quarter of 2025, while free cash flows rose to 105.8 billion riyals ($28.2 billion), compared to 88.4 billion riyals ($23.6 billion) during the same period last year.
The debt ratio decreased to 5.5 percent at the end of September 2026, compared to 6.2 percent at the end of last June, an indication of the strength of the company’s financial position.
Aramco's Board of Directors announced basic dividends for the third quarter amounting to 82.1 billion riyals ($21.9 billion), an increase of 3.5 percent year-on-year, to be paid during the fourth quarter of the current year.
At the sector level, adjusted earnings before interest, income taxes and zakat for the refining, chemicals and marketing sector increased by 234 percent year-on-year, driven by improved refining margins.
In the exploration and production sector, the company announced the start of production in the project to increase crude oil production in the Al-Zuluf field, confirming that its other major projects are proceeding according to the specified timetables, including the second phase of the Al-Jafoura field project, the expansion of the Al-Fadhili gas plant, and the Dammam field development project.
In the context of enhancing the flexibility of its exports, Aramco said that the East-West pipeline continued to provide additional options for exporting oil, noting that it is looking for additional storage capacities abroad and new export routes, with the aim of strengthening its global supply network.
The company also expanded its investments in the artificial intelligence sector, by acquiring a 49 percent stake in Humane, which included the transfer of assets and cash contributions worth approximately 9.9 billion riyals ($2.6 billion).
In another step to diversify its activities, Aramco signed a shareholders’ agreement to establish a joint venture for mineral exploration and hard rock mining, benefiting from its expertise in the exploration and production sector to expand into activities related to the energy and natural resources sector.
Al-Nasser: Business flexibility ensured continuity of supplies
Aramco's President and Chief Executive Officer, Engineer Amin Nasser, said that the state of geopolitical uncertainty and attacks on major energy facilities contributed to increasing the severity of the global energy supply crisis during the third quarter of 2026, with serious repercussions on global energy security.
He added that the dedication shown by the company's staff, in addition to its operational excellence, the flexibility of its business system, and the strength of the supply chain network that it built over decades, enabled it to continue providing reliable supplies to its customers during this exceptional period.
Al-Nasser explained that the company continues to search for additional storage capacities abroad and alternative export routes, with the aim of strengthening its global supply network, noting that the strong operational and financial performance during the volatile period demonstrates the importance of the flexibility that the company enjoys.
He stressed that Aramco, supported by its strong financial position, continues to focus on the disciplined implementation of priority projects, employing advanced technologies to improve performance and open horizons for new opportunities, while continuing to meet the world’s growing energy needs and creating value for shareholders and customers.
