Dollar Firms Near Its Range Top as Equities Rally and Euro Extends Its Slide

The Dollar Index sits at 102.00, up 0.08% — but with it 04:00 in Sydney and cash FX inside its weekend closure window, that print reflects Friday's completed session carrying through the weekend, not fresh trading. That keeps the index near the top of its 14-session range of 100.73-102.09 (a net move of 1.35%) after three straight up-sessions. Friday's lift wasn't a yields story: the 10-year Treasury yield rose just 1.3bp to 5.244%. Instead it rode a broader risk-on tape — the S&P 500 up 0.56% to 7821.05, the Dow up 0.91%, and the VIX down 3.70% to 14.84 — alongside a firm bid in gold (+1.49%) and silver (+2.78%), an unusual combination of a firmer dollar and a broad commodity rally.

US yields moved only modestly: the 10-year added 1.3bp to 5.244%, the 5-year added 3.0bp to 5.021%, the 3-month added 1.4bp to 4.057%, and the 30-year slipped 0.6bp to 5.600% — small shifts across the curve, not a sharp directional move. The policy backdrop hasn't changed: the Fed funds target stands at 3.75-4.00% after a 25bp hike on September 16 (a 12-0 vote), the first hike since 2023, and most officials project at least one more hike this year. The live question remains how many further hikes, not whether cuts are coming. The 20+ Year Treasury ETF added 0.12% to 77.93, consistent with the long end's quiet tone. US CPI, due Wednesday, is the next data point with Fed relevance.

EUR/USD trades at 1.1201 (-0.09%), still digesting Friday's slip to around 1.1196 and a fifth straight weekly decline. GBP/USD is at 1.3231 (+0.01%), pinned inside a tight 24-hour range of 1.32057-1.32502 with no UK data on tonight's slate. USD/JPY is at 158.31 (+0.26%), extending its grind higher as the wide gap between the Fed's 3.75-4.00% and the BoJ's 1.25% policy rate keeps dollar demand intact. USD/CAD is at 1.4253 (+0.20%), still underpinned after Friday's Statistics Canada report showed September employment fell 0.3% and the unemployment rate rose to 6.5%, paring back near-term Bank of Canada hike bets.

EUR/USD trades at 1.1201 (-0.09%) tonight. In Friday's completed session it slipped to around 1.1196 (-0.13%), an intraday bounce toward 1.1225 having faded, as broad dollar demand and bets for further Fed tightening weighed, alongside French fiscal stress, as the French budget fight and student protests ran through the week. ECB officials signalling no urgency for fresh hikes after September's 25bp move offered a partial offset. That made a fifth straight weekly decline. Ahead: German final HICP and the French budget's revenue-section debate Tuesday, US CPI Wednesday, euro-area industrial production (August) Thursday; the ECB's next decision isn't until October 29.

Today's calendar shows no scheduled events, and the data source may be delayed — treat this as a gap, not an all-clear. Looking ahead: Monday is a US holiday (Columbus Day, SIFMA bond market closed), with Japan's Sports Day holiday and Canadian Thanksgiving also shutting those markets, thinning FX liquidity. Tuesday brings German final HICP, the French National Assembly's budget plenary debate on the revenue section, and Japan's Corporate Goods Price Index (September). Wednesday brings US CPI. Thursday brings euro-area industrial production for August. Further out, the UK's Autumn Budget lands October 28, the same day as the Bank of Canada's decision (with a Monetary Policy Report and a press conference from Governor Tiff Macklem); the ECB meets October 29, and the BoJ meets October 29-30.