The Swiss franc held gains against the dollar on Tuesday as traders sought save-havens amid heightened anxiety about potential Iranian retaliation to a U.S. drone strike that killed its most prominent military commander.
The yen, another safe-haven currency, pulled back from a three-month high versus the dollar, but sentiment remains fragile due to the increasing worries about armed conflict between the United States and Iran.
Highlighting the concerns, the U.S. currency nursed losses against sterling and the euro as the emergence of a new geopolitical flash point led some investors to reassess their tolerance for risk at the start of the new year.
The United States has denied Iranian Foreign Minister Mohammad Javad Zarif a visa to travel to New York for a United Nations Security Council meeting on Thursday, according to a U.S. official, raising questions about what steps Iran will take next.
Against the dollar, the Swiss franc was quoted at 0.9689 following a 0.5% jump on Monday toward its highest level in more than a year.
The yen was steady at 108.44 per dollar, off a three-month high of 107.77 touched on Monday.
The dollar index (DXY) against a basket of six major currencies stood at 96.650, following a 0.2% decline on Monday.
Spot gold another safe-haven asset, fell 0.5% to $1,558.62 per ounce, pulling back from a near seven-year high of $1,579.72 reached on Monday.