Dollar Index Nears 100 as Treasury Yields Soar to 4.80%

The U.S. Dollar Index (DXY) has been experiencing a rebound, reaching 99.70 and approaching the psychological threshold of 100. The greenback's strength is primarily driven by rising U.S. Treasury yields, which have climbed to 4.80%, their highest level since early 2025. This increase in bond yields makes dollar-denominated assets more attractive to investors.

Rising energy prices are also a key catalyst for the dollar's recent strength. Tensions in the Middle East have pushed crude oil prices to their highest levels since July 24, leading markets to reassess the potential impact of energy supply disruptions on global inflation.

However, recent U.S. economic data has presented mixed signals. The number of job openings in July fell short of market expectations, indicating a less robust labor demand. Meanwhile, the ISM Manufacturing PMI declined to 54.6 in August from 55.6 in July, but remains in expansion territory.

The core contradiction in the current U.S. dollar market is between support from high yields and constraints from fiscal risks. Short-term direction remains dominated by expectations for Federal Reserve policy, while the medium term warrants closer observation of potential changes in U.S. fiscal conditions, economic growth, and global capital flows.