Goldman Sachs discusses the UST buyback program."

Bessent got a lot more explicit yesterday. Buybacks can be more than $4bn per issue, Treasury has a "big toolkit," and he is now talking about fiscal consolidation. Bessent himself labeled their action as "...What I would call a Treasury twist here in terms of the bond market". The market did not respond well to the follow up communication though... most of the initial rates move reversed, with 10s back around 4.7% and 30s around 5.25%. Between joint yen interventions, long end buybacks, and an explicit willingness to do more, we are dealing with a highly active and tactical Treasury," GS notes.

"[Our] instinct remains that the more durable expression is lower dollar rather than structurally lower rates. While the comments on fiscal consolidation are potentially the most important new development, the market remains skeptical about the near-term execution and the specific mechanisms proposed (such as the Fraud task force) to achieve hundreds of billions in savings," GS adds.

AUD/USD surged to a 2½-month high on Friday, with the pair positioned to potentially break above 0.7700 if the U.S. dollar continues to be shunned by investors. The dollar's broad weakness began Wednesday after Treasury Secretary Bessent announced plans to double buybacks of long-duration Treasury securities, and selling intensified Thursday when he indicated buybacks could exceed $4 billion per issue. This dollar aversion has fueled sharp rallies not just in AUD/USD but across alternative assets including gold, silver, bitcoin, and ether. Should the greenback remain out of favor, both these dollar alternatives and AUD/USD could stay well-bid.

From a technical standpoint, AUD/USD's price action is flashing upside risks, and an extension of the current rally could trigger a significant bullish signal. Since March, the pair has been consolidating gains from its rally off the November 2025 monthly low—a pattern that itself is considered bullish. This consolidation phase would be complete with a break above the May monthly high, which would suggest AUD/USD's longer-term uptrend is set to resume.

If that breakout occurs, the measured-move target derived from the November 2025 low to May 2026 high rally points to a test of the 0.7720 area. Adding to the bullish case, the monthly RSI is rising and the 20-month Bollinger Bands are both rising and widening—technical signals that support the potential for further gains in the pair.
audusd


(Christopher Romano is a Reuters market analyst. The views expressed are his own)

Bank of America Global Research discusses the latest wave of yen-buying intervention and USD/JPY outlook into year-end.

The current yen-buying intervention framework involves four key players: Japan's Ministry of Finance (MoF), the US Treasury, the Takaichi administration, and the Bank of Japan (BoJ). Yet their degree of alignment is unclear given differences in mandates and policy objectives.

"Policy options to support the yen include FX intervention by the Japanese and US authorities, BoJ rate hikes, and fiscal or broader economic measures by the government. Intervention can also affect the incentives and effectiveness of other policy tools.

There is also growing speculation that Prime Minister Takaichi could reshuffle the cabinet by September. It is unclear whether and how intervention developments would influence personnel decisions, but political considerations cannot be ruled out," BofA notes 

"We remain constructive on JPY and revised down USD/JPY forecasts this month, expecting USD/JPY at 149 (152 previous) for end-2026," BofA adds.

ANZ Research discusses EUR/USD outlook for the coming week.

"Looking ahead, we remain constructive on EUR/USD, particularly as domestic fundamentals contrast with softer US data. However, we expect gains to be steadier rather than exponential after the recent rally. The pair remains above its 50-, 100- and 200-dmas, signalling underlying demand on dips. Momentum indicators, however, appear stretched, with the 14-day RSI at 74, firmly in overbought territory. While this does not negate the broader bullish trend, it suggests the pace of further appreciation may slow in the near week," ANZ notes.

"On the crosses, EUR/GBP remains attractive. Euro area growth data have continued to surprise positively, while expectations for additional BoE tightening remain more constrained. In the near term, we see the pair rising to 0.86with support at 0.856 (50-dma) and resistance at 0.862 (100-dma)," ANZ adds.

• AUD/USD invalidated Thursday's bearish signals today, traded 0.7111-0.7166

• Pair hit a 2-1/2-month high as the USD seems unwanted by investors

• US dollar alternatives were sought which helped boost AUD/USD

• Gold, silver, Bitcoin rallied significantly & equities traded higher

• USD/CNH drop to a fresh 3-1/2- low of 6.7180 contributed to AUD/USD's lift

• AUD/UD leaped above the 61.8% Fibo of the 0.7277-0.6867 decline

• Rising daily, monthly RSIs & pair's hold above 10- & 21-DMAs are bullish signals

• 76.4% Fib of 0.7277-0.6867 & June's monthly high at 0.7190 are key resistances
audusd


(Christopher Romano is a Reuters market analyst. The views expressed are his own)

• Cryptocurrency and blockchain-related companies rise in premarket trading after Bitcoin climbs more than 6% to the highest level since late May

• Crypto stocks gained in the previous session after U.S. President Donald Trump called on Congress to pass a crypto bill, as well as a boost to risk assets following the Treasury Department's move to support ​long-duration bonds

• Crypto exchange Coinbase Global gains 6.1%

• Crypto miner Bit Digital advances 4.7%, while Hut 8 adds 2.9%

• Mara Holdings climbs 5.2%, while Riot Platforms Inc rises 3.3%

• ProShares Bitcoin Strategy ETF gains 6.8% and iShares Bitcoin Trust ETF 6.7%

(Reporting by Tharuniyaa Lakshmi in Bengaluru)

• Eurozone manufacturing PMI rises to 52.8 in August beating f/c

• Eurozone services PMI beats 51.5 f/c at 51.7 in August

• Composite rises to highest since Nov 2025 at 52.1 from 52.0

• EUR/USD rise over 1.1696 targets return to May 6 high at 1.1797

• A rise over 1.1737 would target April 17 peak at 1.1849

•
EURUSD


(Jeremy Boulton is a Reuters market analyst. The views expressed are his own)

• USD/JPY breaks from the pack, untouched by the USD selling pressure hitting other currency pairs

• Pair stays range-bound, reinforcing bias to stay short USD/JPY option gamma as realised vol remains pinned

• 1-month implied vol just 7.40 - front-dated tenors trapped in a tight range, barely reacting to broader USD sell-off

• Surface still firm though: 1-month 25d risk reversals at 1.90 JPY calls over puts - between 1.85-2.0 this week

• This downside USD/JPY skew looks driven entirely by intervention risk, not genuine conviction to sell USD/JPY outright

• Divergence highlights that the FX options market still not treating JPY as a clean USD-weakness beneficiary

• Related comment - USD put demand stalls as Bessent bid unravels
USD/JPY 25 delta risk reversals


(Richard Pace is a Reuters market analyst. The views expressed are his own)

• Bitcoin gains almost 17% in just three sessions

• BTC surges from $64,112 to $75,726

• Rally accelerates on move over 200-DMA at $68,963

• The 200-DMA defined Thursday's low now underpinning Bitcoin

• May highs around $78,000 and big nearby fibo now in focus

• $77,462 is 78.6% May-Jul drop - extension to $82,833 likely if broken

•
Bitcoin


(Jeremy Boulton is a Reuters market analyst. The views expressed are his own)

• FX option strikes expire at 10am New York/14:00 GMT on Friday August 21

• EUR/USD: 1.1600 (1.1BLN), 1.1625 (895M), 1.1640-50 (1.2BLN), 1.1685 (1.2BLN), 1.1700 (435M), 1.1715 (519M), 1.1800 (1.4BLN)

• USD/CHF: 0.7925 (300M). GBP/USD: 1.3590-1.3600 (200M)

• AUD/USD: 0.7100 (450M), 0.7125 (302M). AUD/NZD: 1.1980 (142M), 1.2000 (200M)

• USD/CAD: 1.3800 (220M), 1.3850 (440M). EUR/JPY: 181.90-95 (1.5BLN)

• USD/JPY: 158.00 (614M), 158.50 (264M), 159.00 (901M), 159.40-50 (439M), 159.75 (207M)

• FX options wrap - USD put demand drives price action (Richard Pace is a Reuters market analyst. The views expressed are his own)

• Shares of Australia's Meeka Metals rise as much as 13% to A$0.1300, hitting their highest level since June 3

• Gold explorer reports visible gold in its drill hole at Turnberry Gold Project in Western Australia

• Adds mobilised a second diamond drill rig in mid-August to accelerate findings

• MEK shares up 30% so far this week, best week since August 2022

• YTD, stock down ~50%, including session's moves
(Reporting by Subhalakshmi Dey in Bengaluru)

• EUR/USD remains relatively bid in Asia after rally to 1.1710 EBS yesterday

• Asia tad lower and 1.1681-92, holding above 1.1682 hourly Ichimoku tenkan

• In area of 1.1690 hourly kijun, well above 200-DMA at 1.1631 below

• Massive option expiries in area today, to help contain spot action

• Between 1.1500-95 total E16.7 bln, 1.1600-90 E5.2 bln, 1.1700-95 E1.4 bln

• EUR/JPY well bid, 185.73-95 EBS, tracking away from 184.74-99 daily cloud

• Highest since 187.43 July 30 just before US FX intervention

• EUR/GBP off in Asia after rally Wednesday, yesterday 0.8585 to 0.8563

• Some option expiries today at 0.8450 strike below

• EUR/CHF up to 0.9350 yesterday, coming off in Asia? 0.9350 to 0.9344

• Holding between 0.9317 daily Ichimoku kijun, 0.9358 tenkan

• Still below descending hourly Ichimoku cloud between 0.9357-59

• Related comments , , ,

• And , , also
EUR/USD:


EUR/JPY:


EUR/CHF:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)

• GBP/USD +0.15% Fri in Asia as pair threatens fresh topside extension

• Break of 1.3660-65 resistance would spur next leg higher, target 1.3867

• UK Jul retail sales due Fri (poll -0.5% m/m), Aug flash PMI also due

• GfK Aug consumer confidence index hits 2-year high after recent upbeat data

• U.S. Treasury attempts to deflate long-end UST yields being met with dubiety

• Brent crude elevated in wake of U.S. sanctions threats to Iran & its allies

• Range Asia 1.3633-55, support 1.3274 1.3140, resistance 1.3660-65 1.3870
GBP Daily 21/55/100-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

• AUD/USD +0.25% Fri in Asia as USD index begins to look shaky again

• AU Aug S&P PMIs: manufacturing 52.0 (prior 52.0), services 52.9 (prior 53.6)

• Traders sceptical of U.S. Treasury's ability to cap long-term interest rates

• U.S. threatens extreme sanctions for Iran and countries assisting them

• AUD 0.7130-35 resistance short term key, break above opens topside to 0.7200

• Pair pushing upper hourly Bollinger band, flirts with overbought territory

• RBA Aug monetary policy meeting minutes released Tue, AU Jul CPI due Wed

• Range Asia 0.71105-31 support 0.6920 0.6866, resistance 0.7135 0.7200
AUD Hourly Bollinger Study & DXY Daily 55-DMA


AUD Daily 55-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

• GBP/USD +0.1% in Asia Fri as 2-month long rally threatens to extend

• GfK Aug consumer confidence index hits 2-year high after string of good data

• GBP break above 1.3660-65 resistance zone would open topside toward 1.3867

• UK Jul retail sales due Fri (poll -0.5% m/m), Aug flash PMI also due

• Traders wary of U.S. Treasury attempts to cap long-term interest rates

• U.S. threats of tough sanctions for Iran & its associates sends oil higher

• Range Asia 1.3633-435, support 1.3274 1.3140, resistance 1.3660-65 1.3870

• (
GBP Daily 21/55/100-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

• EUR, other majors continued to gain vs USD o/n whilst JPY retraced lower

• USD/JPY bounced back up to 159.18 EBS in New York before falling back

• Japanese exporters sales may have been responsible

• USD/JPY 158.89-159.08 so far in Asia, looking on heavy side

• Back below 159.43-161.64 ascending daily Ichi cloud after push back in o/n

• Still ascending 200-DMA 158.33 below, now flat 100-DMA 159.99 in cloud

• 100-DMA along with the daily Ichimoku kijun at 159.59 to help cap again

• 100/200-HMAs at 159.10/19 to help cap too, hourly cloud 158.57-90, support

• Chunky option expiries today between 159.40-50, at 159.00, between 158.00-50

• JGB-US Treasury rate differentials remain narrow, in 2s @249, 10s @179 bps

• Related comments , , ,

• And , , also

• US markets , , ,

• On US Tsy buybacks , ,

• On US data , , Fed ,

• Also , for more click on [FXBUZ]

USD/JPY:


USD/JPY hourly:

(Haruya Ida is a Reuters market analyst. The views expressed are his own)

• NZD/USD -0.3% from Thur 0.5964 high, but retains strong topside bias

• NZ Jul trade balance 1.95 bln deficit m/m, -5.24 bln y/y (prior -3.75 bln)

• NZD consolidates break above 0.5925-30 resistance zone, now targets 0.5995

• Doubts grow around U.S. Treasury ability to cap long-term interest rates

• Trump threatens countries judged to be assisting Iran, Brent crude +2.0%

• Range NZ 0.5941-47, support 0.5831 0.5762, resistance 0.5995 0.6090-95
NZD Daily 55-DMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

Danske Research discusses the UST buyback program.

"Yesterday, the US Treasury announced an increase to buyback volumes of longer-dated Treasury bonds. To be clear, technically such a change should not have a significant impact on broader market conditions, but the timing matters here. The announcement came after a significant rise in long-end yields earlier in August, and at the same day as the US government debt reached USD40 trillion for the first time. The change intends to improve the liquidity of longer-dated off-the-run Treasuries, but as the buybacks are financed with increased issuance of short-dated T-bills, they also reduce the average maturity of all Treasuries outstanding. This drove sharp flattening of the Treasury curve, which is also politically convenient ahead of the midterms, as it means lower long-end mortgage rates," Danske notes.

"In addition, the increased reliance on short-end issuance links the government's financing costs more closely to the Fed's monetary policy - and perhaps it was the renewed concerns of the Fed's independence that helped explain the sharp weakening in broad USD FX.

Speculation aside, do note that the Treasury had recommended a similar change already more than a year ago  meaning that it should not been seen as a purely ad-hoc decision just to support the long-end Treasury market," Danske adds.

• AUD/USD -0.3% from Thur 0.7133 fresh 10-week high as USD support emerges

• U.S. Treasury capacity to cap long-term yields in question, UST yields firm

• Trump threatens countries judged to be assisting Iran, Brent crude +2.0%

• AUD struggling to clear resistance near 0.7130-35, inflection zone forming

• RBA Aug monetary policy meeting minutes released Tue, AU Jul CPI due Wed

• Overnight range 0.7103-33 support 0.6920 0.6866, resistance 0.7135 0.7200
AUD Hourly Bollinger Study & DXY Daily 55-DMA


AUD Weekly 52-WMA

(James Connell is a Reuters market analyst. The views expressed are his own.)

• EUR/USD rallied 1.1670-1.1710 overnight, NY opened near that high

• The pair fell in NY on broad-based USD buying, US yield

gains

• EUR/USD neared the overnight low then rallied on gold, silver, stocks up moves

• 1.1695 was neared but the bounce faded and the pair fell to 1.1670

• Persistent USD buying, USD/CNH lift off its low, drop in stocks weighed

• EUR/USD sat just below 1.1680 late, it traded down -0.05% in NY's afternoon

• Daily RSI diverged on the 3-month high & a daily gravestone doji candle formed

• Rising monthly RSI, hold above the 200-DMA give bulls some comfort
eurusd


(Christopher Romano is a Reuters market analyst. The views expressed are his own)

• AUD/USD traded 0.7103-0.7133 overnight, hit a 2-1/2-month high ahead of NY's open

• NY opened near 0.7125, the pair traded heavy for most of the NY session

• The overnight low was hit in early NY, the pair then rallied toward the overnight high

• Upward moves in gold, silver, copper & equities helped the lift but sellers emerged

• Firm US yields , USD buying, USD/CNH lift off its low weighed on AUD/USD

• The pair near 0.7110 late, AUD/USD traded down -0.18% in NY's afternoon

• Daily RSI diverged on the high, pair fell below the 61.8% fib of 0.7277-0.6867

• Rising monthly RSI, pair's hold above 10- & 21-DMAs give bulls some comfort
audusd


(Christopher Romano is a Reuters market analyst. The views expressed are his own)

Sterling's recent climb past 1.36 appears set to continue, spurred by the U.S. Treasury's decision to increase its long-end Treasury buyback program announced on Wednesday.

This move weakened the U.S. dollar, propelling cable to a three-month high of 1.3661 on Thursday, even as long-end UST yields experienced a slight rebound. Despite the dollar's dip, underlying U.S. fiscal concerns are unlikely to subside without a reduction in Treasury issuance, a development closely tied to November's refunding announcement.

Near-term market sentiment is being shaped by policy expectations for both the Fed and the Bank of England. LSEG's IRPR indicates a potential 25 basis point Fed hike in 2026, with nearly 50% odds for a second in late 2027. The BoE is also anticipated to hike once in 2026, with slightly more aggressive projections for 2027. This alignment in rate expectations is likely fueling the unwinding of short sterling positions among IMM speculators, a trend further supported by recent Reuters polls suggesting a more dovish Fed outlook into 2026 than current futures data on LSEG's IRPR suggests. However, GBP/USD bulls might encounter headwinds from ongoing geopolitical tensions in the Middle East. Persistent instability, especially concerning oil flows through the Strait of Hormuz, could risk dislodging inflation expectations. If this scenario unfolds, the dollar could reassert its safe-haven status, buttressed by a prolonged period of high U.S. interest rates.

Currently, resistance for GBP/USD is observed near today's trend high of 1.3660, followed by the February 4 peak of 1.3733. Support is found at the 10-day moving average of 1.3534, with bulls maintaining control as long as the price stays above the 200-day moving average at 1.3423.
GBP Chart:


(Paul Spirgel is a Reuters market analyst. The views expressed are his own)

MUFG Research discusses the UST buybacks program.

The US Treasury unscheduled announcement yesterday that it would increase US Treasury bond buybacks resulted in the biggest daily drop for the US dollar since March when you exclude the two episodes of USD selling intervention in April/May and July," MUFG notes.

"We would  argue that Scott Bessent is not following his own advice. Following the joint intervention at the end of July Bessent stated that “you can give market signals with intervention, but it’s policy that turns it”. He added that FX intervention “would need to be followed by Japanese policies addressing the forces driving the yen lower...

Well, if Scott Bessent really believes that then the US Treasury could play a key role here by of course addressing the ever-expending fiscal deficit with fiscal consolidation.

We all know that’s not going to happen and hence the danger now following this announcement (and the FIMA report comment to Japan following intervention) is that it proves counter-productive and leads to reduced appetite for either holding US assets (UST bond sales) or reduced appetite for exposure to the US dollar (dollar selling) or both. Even if the Treasury buy-back plan does contain yields, the US dollar now remains more vulnerable to the downside on the fact that yields are potentially lower," MUFG adds.