The U.S. dollar was flat on Tuesday, as dovish Federal Reserve rate expectations and a let up in a steep bond sell-off was countered by an ongoing impasse between Washington and Tehran in the Middle East.

At 15:10 ET (19:10 GMT), the U.S. dollar index, which tracks the greenback against a basket of six major peers, was just above the flatline at 99.66. The gauge slipped to an over two-month low of 99.29 in the previous session.

Oil prices retreated on Thursday as markets parsed ongoing uncertainty over supplies from the Gulf region and worries over a weak outlook for crude demand. 

Benchmark Brent oil futures had fallen 2.5% to $86.73 a barrel by 09:10 ET (13:10 GMT), while U.S. West Texas Intermediate crude futures had dropped 2.8% to $80.57 a barrel.   

Gold prices were about 1% higher on Wednesday, after an in-line July consumer inflation report prompted traders to reduce Federal Reserve interest rate hike expectations. Gains were capped by continued uncertainty over a Middle East peace deal to reopen the Strait of Hormuz. 

At 15:12 ET (19:12 GMT), spot gold climbed 1.1% to $4,416.15/oz, while gold futures advanced 0.8% to $4,476.35/oz.

The U.S. dollar on Wednesday bounced back from a session low to tick higher, as ongoing uncertainty over a Middle East peace deal offset an in-line July consumer inflation report that reduced odds of Federal Reserve rate hike expectations. 

The dollar had strengthened in recent sessions as investors raised expectations for tighter monetary policy, but the latest inflation data failed to deliver the upside surprise needed to extend that move.