The U.S. dollar (USD) continued to hold strong on Tuesday, supported by higher U.S. Treasury yields. Notably, USD remains closely watched by global investors.
Markets are also awaiting any new steps from the Federal Reserve on interest rates, which could further impact USD movements in the coming weeks.
The US dollar index, which measures the greenback’s performance against a basket of major currencies, recorded about 101.01 points.
It approached a one-year high of 101.13 points.
Analysts said expectations of continued tightening monetary policy in the United States contributed to the support of the U.S. currency.
Higher bond yields have also boosted the dollar’s attractiveness to investors.
Oil prices support markets
The recovery in oil prices contributed to providing additional support to the US dollar after losses seen in the previous sessions, reflecting positively on USD appeal.
The improvement came as investors followed talks on energy and geopolitical developments in the region.
Traders awaited clearer indicators on global oil flows and their impact on the movement of markets and currencies in the coming period, particularly regarding USD stability.
Japanese Yen Under Pressure
The Japanese yen continued its decline against the US dollar, continuing to about 161.59 yen per dollar. It is approaching historic levels that are among the weakest in decades. In fact, comparisons to historic USD peaks are becoming more frequent.
The decline has raised concerns among Japanese authorities, especially as volatility in exchange markets increases.
Reports indicated that consultations between Japanese and U.S. officials are continuing to monitor currency conditions and the possibility of taking measures to curb sharp volatility.
Investor Awakening
Investors are currently looking at the decisions of major central banks, led by the US Federal Reserve.
