EUR/USD, GBP/USD face pressure as BRICS reduce Treasury holdings

EUR/USD and GBP/USD are experiencing downward pressure as BRICS nations quietly reduce their US Treasury holdings, potentially strengthening the dollar through reduced supply dynamics. EUR/USD has declined 0.4% to 1.0420, while GBP/USD dropped 0.5% to 1.2580, as markets digest the implications of decreased foreign demand for US debt. The coordinated reduction by Brazil, Russia, India, China, and South Africa represents a strategic shift away from dollar-denominated assets, though paradoxically supporting USD strength in the near term through scarcity effects. USD/JPY remains elevated at 156.80, while EUR/GBP shows relative stability at 0.8280. Technical analysis reveals EUR/USD testing support at 1.0400, with further downside targeting 1.0350 if breached. The development could force the Federal Reserve to reassess monetary policy if domestic buyers must absorb increased Treasury supply, potentially affecting global forex dynamics through 2025.