REUTERS, London

The dollar was steady on Monday after US President Donald ​Trump rejected Iran’s response to a US peace proposal, sending oil prices higher and prompting renewed concerns that ‌the conflict in the Middle East will drag on.

The US dollar index , which measures the greenback’s strength against a basket of six currencies, was little changed at 97.995.

Oil prices, meanwhile, jumped, with Brent crude up 3.6 percent at $104.94 a barrel, after President Donald Trump on Sunday rejected Iran’s response to a US proposal for peace ​talks, raising worries that the 10-week-old conflict may drag on.

Yet, markets still seem to believe that the conflict will be resolved, ​said Kenneth Broux, head of corporate research for FX and rates at Societe Generale.

“I think the reason for that may be the involvement of China,” he said. “The summit with China and the US later this week is, ​for me, the main event really,” Broux said, pointing to the influence the two countries have in the Middle East.

Trump and Chinese President Xi Jinping are set to discuss Iran, Taiwan, artificial intelligence, nuclear weapons and critical minerals when they meet, according to US officials.

Inflation and growth worries linked to higher oil prices, as well as any potential reaction from central banks, also continue to play on the ​market’s mind, Broux said.