Report published September 28, 2026

Daily FX Update: Scotiabank on USD Strength, Surging Treasury Yields, and JPY Intervention

Scotiabank · September 28, 2026

The US Dollar is broadly stronger against most G10 currencies as 10-year US Treasury yields hit fresh multi-year highs above 5.2% and elevated oil prices spur central bank tightening expectations. JPY and GBP are the main outliers of resilience, while CAD, MXN, and CHF face selling pressure.

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Finvaulta summarizes Scotiabank's analysis. Attribute opinions, forecasts, time-sensitive values, and chronology to the issuer and report date; do not treat this page as an independent verification or a current market-data source.

Key Takeaways

1.The US Dollar is broadly strengthening against most G10 peers, propelled by rising oil prices, firming Federal Reserve rate hike expectations, and elevated US Treasury yields.
2.US Treasury 10-year yields extended above 5.2% to their highest level since 2007, driving curve flattening and supporting the DXY near its 2026 year-to-date peak.
3.JPY outperformed in late Asian trading following intervention warnings from Japanese officials, while GBP held flat on hawkish comments from BoE's Ramsden.

Overview
USD Remains Well Supported w/ Focus On Oil, Yields, and Fed Rate Path
Today's Calendar

Report data

USD (DXY) vs. US 2-10 Treasury Yield Spread

Metric	Estimate	Context
US 10-Year Treasury Yield	5.2%	Reached marginal fresh high, highest level since 2007
Fed October 28 FOMC tightening priced	18.0 bps	Rate hike expectations priced into money markets for the October meeting
Fed December 9 FOMC cumulative tightening priced	38.0 bps	Cumulative tightening priced through December FOMC
DXY Fair Value Estimate	100.5 index points	Scotiabank fair value estimate based on 2Y yield spreads versus spot just above 101
USDCAD Spot Rate	1.4163 CAD per USD	CAD down 0.2% vs. USD