Dollar Hits Three-Month Lows on Fiscal Concerns, Bond Yields

The US dollar fell to three-month lows after a weekly slump, battered by deep-seated fiscal concerns. The US Dollar Index, which tracks the greenback against six major peers, was down 0.1% to 98.80.

Concerns over inflation and rising bond yields weighed on the dollar, driven by a sell-off in longer-end bonds since the Federal Reserve's July interest rate decision. The 30-year yield rose 3.9 basis points to 5.276%, while the 10-year yield climbed 4 basis points to 4.738%.

Rising bond yields tend to strengthen the dollar, but Washington's ballooning debt has sparked growing fiscal skepticism. Investors are increasingly looking to move capital out of fiat currencies and into hard assets such as gold or cryptocurrency, a strategy known as the debasement trade.