The US dollar has extended its recent surge, reaching its highest level in 13 months as global risk aversion intensifies.
The greenback’s advance reflects a broad rotation out of cyclical assets, with investors seeking safety amid escalating geopolitical and economic uncertainty.
This move marks a significant shift in market sentiment, driven by a confluence of external shocks and recalibrated expectations for Federal Reserve policy.
According to analysis from Hospodarske noviny, the dollar’s strength is being underpinned by a "chaos" narrative in global markets, which continues to favor the safe-haven currency.
The report suggests that the current rally could be further amplified if the Federal Reserve delivers a hawkish surprise in its upcoming communications.
Traders are increasingly positioning for a scenario where the Fed maintains a higher-for-longer stance on interest rates, diverging from the easing expectations that had previously weighed on the dollar.