Dollar Upside Limited by Easing Treasury Yields

The US dollar's upside potential remains limited due to Treasury yields easing, according to MUFG analysts.

The recent decline in US Treasury yields has made dollar-denominated assets less attractive to global investors, reducing foreign demand for the currency.

This dynamic has been evident as markets reassess the Federal Reserve's policy path, with futures markets pricing in a significant probability of a rate cut by September, according to CME FedWatch data.