Dollar Steady at 98.84 as Yields Firm and Gold Climbs 3.6%

The US Dollar Index sits at 98.8390, up 0.04% in the session just completed — essentially flat. That quiet DXY print masks bigger moves elsewhere: US Treasury yields firmed across the curve (10Y +4.2bp to 4.738%, 30Y +3.9bp to 5.276%, 5Y +3.7bp to 4.424%), gold jumped 3.64% to 4680.60, and the VIX fell 5.50% to 15.13 even as equities rose (S&P 500 +0.43%, Dow +0.98%). Among the majors, AUD/USD was the standout mover, up 0.82% to 0.7178, while EUR/USD eased 0.08% to 1.1678 after touching multi-month highs in the prior session. It's 04:00 in Sydney, so today's figures reflect the most recently completed sessions rather than this morning's Asia-Pacific trade.

The live policy question remains whether the Fed hikes, not whether it cuts, with the fed funds target at 3.50-3.75%. Yields moved up modestly across the curve in the most recent session: the 10Y added 4.2bp to 4.738%, the 30Y rose 3.9bp to 5.276%, the 5Y gained 3.7bp to 4.424%, and the 3M was little changed, up 0.7bp to 3.710%. The 20+ Year Treasury ETF fell 0.35% to 82.05. Treasury Secretary Bessent is due to speak today (04:00, medium importance) — headlines including 'Bessent battles markets (and the Fed)' (AFR) and 'Jumpy bond markets make it clear: Trump risks driving US into debt crisis' (The Guardian) point to bond-market and Fed-credibility tension as a live theme.

EUR/USD eased 0.08% to 1.1678, pulling back after touching its highest level since May 14 above 1.1700 in the prior session on strong eurozone PMIs. GBP/USD ticked up 0.03% to 1.3648, holding near a six-month high reached on a UK PMI beat and sticky 2.9% CPI. USD/JPY rose 0.04% to 158.94, little changed after Japan's July core CPI firmed to 1.8% y/y. USD/CAD slipped 0.13% to 1.3764, with the Canadian dollar still riding a fourth straight weekly gain even as new US tariffs on Canadian goods took effect.

EUR/USD is the session's rotation to watch: after touching above 1.1700 intraday in the prior session — its highest since May 14 — the pair pared back to the 1.1660-1.1680 area and now sits at 1.1678, down 0.08%. That capped a fourth straight weekly gain and a 2.34% monthly rise. The move followed stronger eurozone HCOB flash PMIs: composite 52.1 (up from July's 52.0), manufacturing 52.8, and Germany manufacturing 54.1. Underpinning the trend, the ECB raised rates 25bp in June to a 2.25% deposit rate, and markets are pricing roughly a 90% chance of a further 25bp hike in September. RSI near 73 signals overbought conditions, warning of near-term pullback risk. Monday's calendar carries no major eurozone data; focus is turning to the Jackson Hole symposium, August 27-29.

Today's calendar is thin. Canada's Corporate Profits q/q print (22:30, low importance; previous -2.0%) leads off. US Treasury Secretary Bessent speaks at 04:00 (medium importance). Australia's Monetary Policy Meeting Minutes follow at 11:30 (low importance). No major eurozone or UK data is scheduled today. Looking further out, markets are positioning into the Jackson Hole Economic Policy Symposium, August 27-29.