Dollar Poised for Weekly Gains as Yields Surge, Fed Rate Hike Bets Strengthen
Market Overview and Currency Movements
By Jiaxing Li
HONG KONG, Sept 25 (Reuters) - 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 Federal Reserve rate hikes kept the greenback near multi-month peaks.
Impact on Major Currencies
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.
Factors Driving Dollar Strength
Markets have aggressively repriced the interest rate trajectory after the Fed tightened policy last week, while robust economic data and fresh 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 greenback a leg up.
Dollar Index Performance
The dollar index, which measures the US currency against a basket of peers, has climbed more than 1% this week to a...