US dollar (USD) market outlook and exchange rates

USD Market Update

12 Aug 2026 • 00:26 GMT

USD/EUR 0.8663

The US dollar has maintained strength, supported by expectations of Federal Reserve rate hikes and a recent sell-off in riskier tech stocks. The dollar index (DXY) remains near the resistance zone of 100.25/65, with potential for further gains as markets price in about 30 basis points of Fed tightening this year. Against the euro, the USD is trading close to 0.8663, just below its three-month average and within a stable range. The euro has shown limited movement, remaining between 1.14 and 1.15 against the dollar.

Meanwhile, the USD is at 0.7402 against the pound, near its 14-day lows, but still within a stable range. The recent rally to 159.3 against the yen is just below three-month highs and reflects broad USD strength amid global uncertainties. Broader energy market developments and geopolitical tensions, especially in the Middle East, could influence USD movements further, but overall, the dollar remains well-supported in the near term. Expect markets to continue monitoring US economic data and Fed policy signals closely.