USD steady as cautious global market sentiment builds on Treasury buyback bets

Global markets traded with a cautious tone as investors weighed unresolved US policy and geopolitical tensions against ongoing speculation about the impact of the US Treasury's decision to double its long-dated bond buyback programme. The buyback expansion, flagged by Treasury Secretary Bessent as potentially exceeding $4 billion, has kept long-end yields volatile and left FX markets without a clear directional driver. Risk appetite remained subdued across equities, while the US dollar held broadly steady against the majors as traders avoided fresh positioning ahead of clarity on the Treasury's issuance and buyback strategy. Safe-haven demand offered intermittent support to the JPY and CHF, while commodity-linked currencies such as the AUD and CAD tracked shifts in broader risk sentiment. With no tier-one data catalyst immediately ahead, near-term FX direction is likely to follow the US yield curve: a renewed rise in long-end yields would favour the dollar, while a successful buyback-driven compression in term premium would weigh on it. Traders should expect range-bound conditions with elevated headline sensitivity.