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The US dollar has surged to a ten-month peak, reaching a 107.16 level on the US Dollar Index, influenced by hawkish views from the Federal Reserve and 16-year high Treasury yields, as reported on Tuesday. This development comes as investors anticipate a longer period of restrictive monetary policy due to broad economic resilience, further cementing the greenback's position in global currency markets.
In contrast, other major currencies have experienced multi-month or multi-year lows. The euro, currently at $1.0476, has slid to its weakest point since December 2022. This decline, driven by algorithmic sales and a decreasing risk appetite, has led to predictions of the euro reaching parity with the dollar.
Other currencies such as the pound, yen (nearing 150 per dollar), Australian dollar, and Russia's ruble have also seen significant lows. The yen's devaluation is particularly notable given its proximity to a 150 per dollar rate.
The current dynamics of the global currency market reflect an overall strong performance of the US dollar and suggest a continued trend of restrictive monetary policy.
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