US longer-dated yields have moved back towards where they stood before the US Treasury’s buyback plans, with the 10-year at 4.7% and the 30-year at 5.24%. The move has weighed on risk assets. In FX, the Dollar Index (DXY) recovered after an initial dip during the session, a shift linked to Japanese Yen (JPY) weakness rather than broad-based dollar strength.
Yields and FX Market Dynamics
The yen’s underperformance has pushed USD/JPY close to 159, while EUR/JPY has climbed towards 185.71, despite joint FX intervention by the US and Japan on 30 July. The market’s positioning also mirrors the post-announcement fade seen after the US Treasury buyback announcement on 19 August, with prices again gravitating towards earlier levels.
Limits of Intervention
The pattern underscores that intervention effects can be transient unless the underlying macro backdrop shifts.
