USD weakness accelerates as markets interpret Treasury buybacks as a sign of deepening US fiscal strain rather than stability.
The US dollar fell sharply in Asian trading Friday as investors rotated into gold and Bitcoin, interpreting Treasury buyback expansions as evidence of structural fiscal challenges. Bessent’s indication that repurchases may increase further failed to reassure markets, with Goldman Sachs warning that yield suppression loses efficacy when sovereign financing dynamics dominate sentiment.
Gold and Bitcoin surged, with the latter poised for its largest weekly gain in over two years. The moves suggest a broader shift away from dollar-denominated assets amid persistent fiscal concerns. Despite intervention, 30-year Treasury yields remain near 5.25%, underscoring limited confidence in temporary measures.
Market reaction reflects growing skepticism over the Treasury’s ability to address underlying fiscal pressures. The rotation into alternative assets signals early-stage diversification rather than routine volatility.