Dollar weakens on Iran sanctions, Treasury buybacks
Analysis based on 6 articles · First reported Aug 25, 2026 · Last updated Aug 25, 2026
The dollar's weakness reflects investor uncertainty over sanctions and Treasury policy, potentially affecting global trade and capital flows. Treasury buyback plans may ease long-term borrowing costs, but limited relief suggests persistent yield pressure.
On Tuesday, the U.S. Dollar Index struggled to hold gains against major peers as investors weighed Washington's expanded Iran-related sanctions and renewed efforts to ease pressure on longer-dated Treasury yields. Treasury Secretary Scott Bessent unveiled an expansion of sanctions against Iran on Monday, warning countries to cut business ties or risk being forced out of the dollar-based financial system. The euro and pound strengthened, while the Canada — Canadian dollar held flat amid U.S. threats to raise tariffs on Canada after trade negotiations collapsed. The Japan — Japanese yen firmed slightly. Treasury yields eased after reports that the U.S. Treasury could use part of its cash balance to buy back longer-dated bonds, following Bessent's announcement to double quarterly repurchases. However, relief was limited, with the 10-year yield at 4.704%. Market participants awaited United States — Federal Reserve Chair Kevin Warsh's debut speech at Jackson Hole for clues on policy and independence. Bitcoin rose 1% after its largest weekly gain in nearly 3-1/2 years.
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