FX.co ★ DXY Extends Pullback

The dollar index slipped to 97.1 on Monday, paring back gains from the previous week as G10 currencies strengthened and fresh concerns emerged that global markets may begin shifting away from dollar-denominated assets. Chinese regulators advised financial institutions to reduce their exposure to US Treasuries, citing concentration risks and uncertainty surrounding US economic policy. This stance echoed similar signals from other major economies that are increasingly wary of over-reliance on US assets, including European pension funds, which have cut back on Treasury holdings following hawkish rhetoric from the White House on Greenland. Meanwhile, the Japanese yen advanced against major currencies after Prime Minister Takaichi’s landslide victory fueled expectations of potential forex intervention, given her loose fiscal stance. The euro also found support after ECB President Lagarde indicated that the central bank is not currently overly concerned about the currency’s strength.