Dollar Weakens as Treasury Yields Fall

2026-10-09 02:09 By Jam Kaimo Samonte 1 min. read

The US dollar index slipped to around 102 on Friday, extending losses from the previous session as Treasury yields declined following a well-received 30-year bond auction, suggesting investors remain willing to purchase long-dated government debt despite the recent market selloff.

Investors also assessed lower oil prices after President Trump said the US was engaged in “productive discussions” with Iran and would refrain from attacking the country before the midterm elections.

Meanwhile, markets are pricing in roughly an 82% probability that the Federal Reserve will keep interest rates unchanged this month, while the odds of a December rate hike stand at around 81%.

On Thursday, Fed Governor Christopher Waller said further rate increases would likely be necessary to bring inflation back to the central bank’s 2% target, but noted that policymakers had “flexibility” in determining the pace of tightening and left open the possibility of a pause at the Fed’s upcoming October meeting.



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Dollar Weakens as Treasury Yields Fall
The US dollar index slipped to around 102 on Friday, extending losses from the previous session as Treasury yields declined following a well-received 30-year bond auction, suggesting investors remain willing to purchase long-dated government debt despite the recent market selloff. Investors also assessed lower oil prices after President Trump said the US was engaged in “productive discussions” with Iran and would refrain from attacking the country before the midterm elections. Meanwhile, markets are pricing in roughly an 82% probability that the Federal Reserve will keep interest rates unchanged this month, while the odds of a December rate hike stand at around 81%. On Thursday, Fed Governor Christopher Waller said further rate increases would likely be necessary to bring inflation back to the central bank’s 2% target, but noted that policymakers had “flexibility” in determining the pace of tightening and left open the possibility of a pause at the Fed’s upcoming October meeting.
2026-10-09
Dollar Little Changed
The dollar index was little changed at 102.2 on Thursday, hovering near April 2025 highs, as the greenback remained supported by expectations that the Fed will need to keep interest rates elevated for longer. Oil prices moved higher again, adding to inflationary pressures and, in turn, reinforcing expectations of further Fed tightening. Minutes from the Fed’s September meeting showed that most policymakers expect another increase in the federal funds rate this year, although the timing remains uncertain. Fed Governor Waller said on Thursday that additional rate hikes will likely be needed to bring inflation back to target, while emphasizing that there is “flexibility” around the pace of increases. Markets currently price in an around 78% probability that the Fed will leave rates unchanged in October, while the odds of a 25bps hike in December stand at around 69%. Meanwhile, higher government bond yields in Europe continued to weigh on the euro.
2026-10-08
Dollar Holds Firm on Hawkish FOMC Minutes
The dollar index held above 102 on Thursday, remaining near its strongest level since April 2025 as the latest FOMC minutes pointed to a hawkish stance among policymakers amid persistent inflation risks. Minutes from the Federal Reserve’s September meeting showed that all 19 policymakers supported the September rate hike, while most believed another increase would be appropriate by year-end. Markets broadly expect the Fed to keep policy unchanged this month, while the probability of a December hike currently stands at around 78%. Investors now await the latest weekly US jobless claims data for further insight into the health of the labor market. The greenback also continued to benefit from safe-haven demand as concerns over a potential escalation between the US and Iran, along with ongoing risks to oil flows from the Middle East, kept crude prices elevated and inflationary pressures high.
2026-10-08