US Dollar Index DXY fall ⭐

The US dollar has tumbled to a three-month low, hitting 98.723 on August 20, 2026, its weakest level since May 14.

This sharp pullback reflects a powerful confluence of market forces: surging long-end Treasury yields (30-year yield spiked to a 19 spiked to a 19-year high of 5.337%) triggered a bond-market selloff, prompting the US Treasury to intervene with an expanded buyback program, a move that ironically raised fiscal concerns rather than calming nerves.

Investors interpreted this as a signal of unsustainable borrowing and policy uncertainty, eroding confidence in the greenback.

Simultaneously, risk sentiment improved, further pressuring the dollar as capital rotated into higher-yielding assets.

The broad-based weakness is clear across major pairs:

- EUR/USD surged to $1.1692, its highest since mid-May
- GBP/USD climbed to $1.3631, a three-month peak
- USD/JPY retreated to 158.41, pulling back from the critical 160.00 level

The DXY index’s decline wasn’t fleeting, it posted a weekly loss of over 0.8%, and its 3-month trajectory shows a decisive break below key support near 99.50. Historical context confirms the magnitude: the index stood at 101.42 on.42 on July 29, meaning it has shed nearly 2.7% in just three weeks.

This isn’t just noise, it’s a structural shift driven by fiscal anxiety and bond-market stress, not just Fed rhetoric.

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