Dollar Rises as Global Bond Yields Surge Amid Inflation Worries
The dollar gained on Tuesday as renewed Gulf attacks sparked a global bond selloff and stoked inflation worries, while the yen slid past 160 per dollar for the third straight session.
U.S. President Donald Trump threatened further strikes against Iran after the first exchange of direct attacks in a month, pushing Brent crude futures above $91 a barrel, fueling inflation worries and spurring a bond selloff.
The yield on 10-year Treasury notes hit its highest since January 2025 while the 10-year Japanese government bond yield touched 3 per cent for the first time in 30 years. U.S. Treasury Secretary Scott Bessent said he believed Japan's government and central bank would take action that leads to a stronger yen, effectively locking the Bank of Japan into raising rates.
The yen traded at 159.99 per dollar after breaching 160, leaving it vulnerable unless the BOJ delivers a clearly more hawkish signal or authorities intervene directly.