USD Strengthens as Treasury Yields Surge on Powell's Fed Exit

The US dollar is gaining broad support as Treasury yields post their largest weekly rise since April 2025, with the 10-year yield climbing 23.5 basis points (5.39%) in a single week to reach as high as 4.599%. Jerome Powell's departure from the Federal Reserve chairmanship is adding uncertainty to monetary policy outlook, fueling a significant bond market selloff. After ending 2025 near 4.16%, the 10-year yield briefly dipped to 3.926% before this sharp reversal higher. Rising yields typically bolster USD demand as higher returns attract capital flows into dollar-denominated assets, putting pressure on pairs like EUR/USD and GBP/USD. The leadership transition at the Fed introduces a key variable for traders, as Powell's successor will inherit a complex policy environment shaped by years of extraordinary monetary interventions. Near-term, the 4.60% level on the 10-year serves as resistance, with a break above potentially accelerating dollar strength. Traders should monitor incoming Fed commentary and leadership signals for directional cues across major USD pairs.