Dollar Tries to Rebound, But US Drama Remains Stalled
The US dollar weakened slightly on Thursday, but not as dramatically as the free fall earlier this week. Markets remain nervous due to the same combination: uncertainty over the direction of US policy (tariffs and geopolitical moves), the issue of political pressure on the Fed, and speculation about the future path of interest rates. On the other hand, the Fed's cautious tone has helped the dollar gain a floor, although not enough to reverse the trend.
A brief respite came from statements by US officials. Treasury Secretary Scott Bessent reiterated that the US has a "strong dollar" policy—but traders continue to interpret this as an attempt to "brake" sentiment, not a signal that the dollar will immediately rebound. Low jobless claims data also supports the narrative that the US economy doesn't yet need aggressive stimulus, so the window for interest rate cuts isn't automatically near.
In Europe, the euro briefly overreached after breaking through the 1.20 area, and is now starting to attract the ECB's attention because rapid appreciation could suppress inflation. In Japan, the yen remains supported by the intervention discourse and expectations of a more hawkish BoJ, but fiscal and domestic political concerns are making the yen's strengthening less likely.
DXY: 96.11
EUR/USD: 1.1959
USD/JPY: 153.15
USD/CAD: around 1.35
Unless the big story changes (the Fed, geopolitics, and Trump's policies), the dollar typically remains vulnerable—and whenever the dollar weakens, the market tends to turn to gold as a primary refuge.
Source: Newsmaker.id
