Dollar Smoked by Treasury Intervention

The US dollar suffered its sharpest decline in three weeks after the US Treasury stepped in to support the long end of the bond market, driving gold and silver prices higher.

This move was officially framed as a mechanism to improve market functioning in longer-dated Treasuries, but experts are more skeptical, suggesting it's an attempt to cap the rise in longer-dated yields before they become too high.

The US Treasury buybacks pushed long-end yields lower, causing the dollar to break support and USD/JPY to turn lower again. This has traders wondering if the move has further to run.