Dollar Surges to 17-Month High Amid Global Bond Rout
The US dollar has risen to a 17-month high as investors worldwide face a bond market rout due to inflationary fears. The global sell-off on Thursday pushed borrowing costs across the globe to multi-decade peaks, with yields on benchmark US 10-year Treasuries reaching 5.344%, their highest since 2002.
Investors are concerned about the impact of higher oil prices and sticky inflation on the economy. Charu Chanana, chief investment strategist at Saxo, said that investors are confronting an 'uncomfortable mix' of sticky inflation, heavy government borrowing, and large bond supply.
The dollar index, which measures the US currency against six rivals, has gained 1% this week, its third consecutive weekly gain. The euro is at $1.1237, hugging its lowest level since May 2025, while the yen was steady at 158 per US dollar after data showed annual core inflation in Tokyo accelerated in September.