The US dollar index held steady on June 1 after a string of weekly losses, with traders stuck in a holding pattern between two massive unknowns: whether US-Iran peace talks will actually produce results, and whether major central banks are about to pivot toward tightening.
Bitcoin has been trading in a range between $70,000 and $73,000 through late May and into early June, a window that reflects the broader market’s indecision.
The Iran factor and the Fed’s inflation problem
The Iran conflict, which escalated in late February 2026, has driven oil prices higher and injected a fresh dose of inflation anxiety into an economy that was supposed to be cooling down.
Fed funds futures are now hinting at a potential rate hike from the current 3.50-3.75% range by year-end. Markets that were previously betting on rate cuts have completely reversed course, now pricing in the possibility that borrowing costs go up, not down.
