Dollar Index Hits Four-Week Peak as US Treasury Yields Climb Ahead of Critical Employment Report

2026-01-12 20:33:00

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The U.S. Treasury yields are climbing as the dollar strengthens into a crucial window for monetary policy decisions. The dollar index surged to 99.091, marking its highest level in four weeks and advancing 0.1%, signaling renewed strength in the greenback as traders brace for major economic data releases.

Fadi Al Kurdi from FFA Kings emphasized that December’s non-farm employment data represents a pivotal moment for shaping 2026 monetary policy expectations. Any material deviation from forecasted numbers could trigger significant fluctuations across currency and fixed-income markets, making this release a key inflection point for investors monitoring interest rate trajectories.

Beyond employment data, market participants are closely watching a potential U.S. Supreme Court ruling on whether President Donald Trump can utilize the International Emergency Economic Powers Act to implement tariffs without requiring congressional consent. This geopolitical uncertainty adds another layer of complexity to an already volatile macro environment, with implications stretching across multiple asset classes.

The convergence of strong dollar momentum, rising Treasury yields, and pending policy decisions has created heightened market sensitivity. Traders are positioning defensively, anticipating that any surprise employment figures or tariff-related announcements could reshape both currency valuations and bond market dynamics in the near term.

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