Precise Investors Editorial Team
Dollar strength pushed the euro to a two-month low of $1.1370 and put it on track for a third weekly decline
The dollar was set for its first back-to-back weekly gains in more than three months on Friday, as surging Treasury yields and mounting bets on further central bank rate hikes kept the currency near multi-month highs.
Dollar strength pushed the euro to a two-month low of $1.1370 and put it on track for a third weekly decline, its worst losing streak since the end of 2025. Sterling languished near a three-month low of $1.3220 and was on track for its worst weekly performance in four months.
Markets have aggressively repriced the interest rate trajectory after the central bank tightened policy last week, while robust economic data and latest energy supply concerns have further strengthened that conviction. A bond selloff, which sent long-dated US Treasury yields to their highest in more than 20 years, also gave the dollar a leg up.
The dollar index has jumped more than 1% this week to a two-month high, marking its first back-to-back weekly gains since June. However, the rally was losing some momentum, last edging a touch lower at 101.2.
Whilst the dollar should get a bid from higher yields, there are still ongoing lingering concerns around the US fiscal position, the unpredictability of US policy making, said Khoon Goh, head of Asia research at ANZ.
I think that’s why the dollar has really struggled to continue to rally, even though yields continue to increase, Goh said.
Oil prices climbed more than 3% on Thursday to a one-week high after a Houthi attack on Saudi Arabia revived fears of supply disruptions, adding to inflation risks.
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