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US Dollar
Source: Newsmaker.id
The US Dollar Index (DXY) weakened to around 101.71 in Tuesday’s (October 20) trading session—a decline of approximately 0.3%—bringing it close to a multi-week low. The pressure on the greenback followed a reversal in oil prices, driven by emerging hopes that US-Iran negotiations could provide a path toward resolving the conflict and alleviating inflationary pressures. Market data indicates that the DXY traded within a range of 101.51–101.97 throughout the session.
Brent crude prices also softened, having previously risen due to heightened geopolitical risks. Reports of a compromise proposal involving Qatar and Pakistan—bridging Washington and Tehran—sparked optimism that global energy supplies might stabilize. However, as the progress of these negotiations remains uncertain, the market continues to exercise caution.
In Japan, the USD/JPY pair hovered around 158.20, reflecting a strengthening yen following record demand at an auction for 20-year Japanese government bonds. Strong demand for the bonds pushed Japanese yields lower, providing support for the yen.
The euro also strengthened to approximately US$1.1237, recovering from earlier pressure caused by political uncertainty in France. Meanwhile, the British pound rose to around US$1.3383, bolstered by UK labor market data that fueled speculation that the Bank of England retains room to maintain a tight monetary policy.
The dollar’s movement was further influenced by lackluster US economic data. Pending home sales for September fell sharply, signaling that high mortgage rates continue to weigh on housing demand. This situation may reinforce the view that the Federal Reserve is under no urgent pressure to raise interest rates at its October meeting.
Newsmaker Analysis: The US dollar is currently facing pressure from a combination of weakening oil prices, lackluster economic data, and expectations that the Federal Reserve will likely hold interest rates steady. Should negotiations between the US and Iran yield genuine progress, a decline in the energy risk premium could further erode support for the dollar. Nevertheless, inflation and the trajectory of Federal Reserve policy remain the primary factors that will determine whether the weakness in the DXY (US Dollar Index) persists.
Source: Newsmaker.id