US Dollar Reaches Two-Month High Amid Euro and Yen Instability
The US dollar on Wednesday, October 8, approached its highest level in the past two months. The strengthening of the American currency occurred against the backdrop of fiscal and economic difficulties in the Asia-Pacific region and Europe, negatively impacting the currencies of competitor nations from the “G10.”
This is reported by AgroReview
Euro Under Pressure from Political Instability in France
The euro is losing ground due to political upheaval in France. The Japanese yen has also weakened, which is attributed to expectations of a possible change in Japan’s leadership and the prospect of an expansionary fiscal policy in the country. This, in turn, may lead to a slower increase in interest rates.
Dollar Dynamics and Expert Assessments
The market is currently actively revising forecasts regarding the macroeconomic outlook for the US, considering the growing concerns about the fiscal sustainability of Japan and France. This was stated by the head of the Asian strategy department at Skandinaviska Enskilda Banken, Yevgeniya Fabon Victorino.
“After falling to its lowest level in over two years in September, the American currency has regained its position in recent days, as a number of negative factors in other countries outweigh any negative impact from the US government shutdown.”
The US dollar index has risen nearly 1% since the end of September, reducing its year-to-date decline to approximately 7.5%. For much of 2025, the dollar demonstrated weakness due to the Federal Reserve’s interest rate cuts, which diminished the attractiveness of the American economy, while gold became a popular safe-haven asset during times of instability.
It is expected that the partial government shutdown in the US will also have a negative impact on the dollar’s dynamics. Analysis of previous episodes—in 2013, at the beginning and end of 2018—showed that the Bloomberg index experienced a decline both during the government crisis and immediately after it.
Financial experts emphasize that there remains uncertainty about whether the US dollar can ensure sustainable recovery in the near term. Rikia Takebe, a senior strategist at Okasan Securities, notes that there are currently no particular reasons to actively buy the dollar compared to other major currencies. Additionally, he points out that the US is moving towards further interest rate cuts, and President Trump is generally not an advocate of a strong national currency.