Dollar Surges to Three-Month High on Rising Yields
The US dollar has reached its highest level in over three months, driven by a surge in US Treasury yields and concerns about global price pressures.
Data released last month showed that US inflation rose less than expected in August, reducing expectations for a Federal Reserve rate hike this month. However, the threat of higher energy prices remains, as underscored by a recent surge in euro zone inflation.
The dollar's rise has been particularly pronounced against the yen, which fell 0.54% to 158.29 on Thursday. This comes after the yen experienced its strongest performance among G10 currencies last month.
Experts attribute the dollar's strength to its sensitivity to changes in US Treasury yields, with some policymakers at the Bank of Japan calling for a faster pace of interest rate hikes or bringing them closer to the central bank's goal. This has led to a strengthening of the greenback against other major currencies.