Higher US yields, resilient jobless claims, and firmer oil prices bolster the USD as markets reassess Fed tightening risks.
The US Dollar strengthened as global yields rose and oil prices firmed, driven by fading optimism over the Strait of Hormuz reopening. USDJPY neared 160, heightening intervention risks amid broader USD support.
US Treasury yields outpaced European counterparts, fueled by reports that Fed officials may back a September rate hike if inflation data remains elevated. Labor market resilience added to the narrative, with initial jobless claims rising just 1k to 199k, beating consensus and staying below 200k for a third week.
While softer June inflation gives the Fed room for patience, underlying economic strength may refocus tightening concerns, keeping the USD moderately bullish over the next two quarters.