Bank of America Securities analysts say the U.S. dollar has emerged as the clear safe haven during Middle East turmoil, with the currency gaining strength as investors seek refuge from oil market disruptions. The bank's research note dated March 3 highlights that the dollar's resilience stems from America's energy self-sufficiency and its historical performance during oil supply shocks.

At 09:40 ET, the Dollar Index traded 1% higher at 99.300, reaching levels not seen since December 2025. Option markets showed strong bullish sentiment for the dollar, with one-month skew turning sharply negative for USD calls - the most negative reading since June last year. The bank noted that trend signals indicate the dollar has exited its downtrend against the euro, signaling a shift away from bearish sentiment.

While the dollar leads as a safe haven, Canadian dollar performance stands out as a secondary beneficiary. As a major oil producer, Canada gains from higher crude prices and suffers less from supply disruptions. This dual advantage - energy exposure plus correlation with the U.S. dollar - positions the Canadian currency as an outperformer in both spot returns and options skew during oil shock episodes.