Dollar at 17-month high as global bond rout hits euro

Business Recorder reported that the US dollar was headed for a third straight weekly gain on Friday, holding near a 17-month high as a global bond sell-off pushed borrowing costs to multi-decade peaks. The sell-off was fuelled by inflation worries tied to higher oil prices, and on Thursday US 10-year Treasury yields climbed to 5.344%, their highest since 2002.

The euro was trading at $1.1237, close to a low last seen in May 2025, as concerns over France's fiscal health weighed on the currency. French bond yields have risen to their highest in 14 years, while the yen held at 158 per dollar after Tokyo's core inflation for September accelerated at its fastest pace in 10 months. The dollar index, which tracks the greenback against six rival currencies, stood at 102.08, on course for a 1% gain this week.

Traders reined in bets on a Federal Reserve rate hike after August's US consumer price data came in softer than forecast, and July's figure was revised lower. Brent crude has climbed back over $100 a barrel while stalled US-Iran negotiations to end the Middle East war continue. Attention now turns to the US payroll report due later on Friday, which is expected to show slower job growth in September.