Lower long-term Treasury yields and expanded buyback operations weigh on the USD amid fiscal credibility concerns.
The US Dollar weakened against all major currencies as longer-term Treasury yields declined following the announcement of expanded buyback plans. The 30-year yield dropped modestly below levels seen before the buyback announcement, pressuring the USD further.
Earlier, Treasury Secretary Scott Bessent indicated the buyback operation could exceed the $4bn initially announced, while emphasizing tools to stabilize the Treasury market. The White House is expected to outline fiscal consolidation measures later this week, though the Congressional Budget Office projects rising deficits and debt reaching 120% of GDP by 2036.
Markets await the US August PMI data to assess whether US growth can still support the Dollar near-term. Global stocks and bonds rose, while crude oil prices stalled amid the yield shift.