Dollar Price Action Slows Amid Treasury Department Announcement
The US Dollar price action has been affected by various market developments in recent days. On Wednesday, an announcement from the Treasury Department sparked a fresh lower-low for the dollar, but the move stalled afterwards.
EUR/USD and GBP/USD saw their breakouts accelerate despite this, while USD/JPY remained a key focus due to its crowded long trade status.
The Japanese Yen accounts for just 13.6% of the DXY basket, yet the USD/JPY pair is more than 50% above its early-2021 level. This has led to concerns about a potential unwind in the carry trade.