The US dollar strengthened against major currencies on Wednesday, September 30, 2026, approaching its highest level against the euro this year. The dollar's rise is attributed to the strong US economic growth and higher interest rates, while Europe faces increasing pressure related to energy and debt. As of Wednesday, the euro traded near $1.1339, after hitting a low of $1.1312, its weakest since May 2025.
The dollar is set to achieve its largest monthly gain against the euro in 14 months, with a 2.5% increase in September. This has also impacted other currencies, with the Australian dollar falling below 70 cents for the first time since early August. The dollar's rise has been significant, reaching its highest level against the Swiss franc in 16 and a half months, at 0.8358 francs per dollar.
The Swiss franc has been under pressure, partly due to investors seeking low-yield alternatives to the Japanese yen, which they sell to take advantage of interest rate differentials in other markets. The yen's attractiveness as a preferred currency for sale against the dollar has waned after Japan and the US intervened in July and August, followed by warnings on testing the countries' commitment to supporting the currency.
The dollar fell by 1.5% against the yen in September. Meanwhile, the Australian dollar stabilized near $0.6986, up 20 basis points from its overnight low. The New Zealand dollar stood at $0.5638, after hitting its lowest level since November. The British pound touched a three-month low on Tuesday before stabilizing near $1.3227.
The US economic growth and interest rate hikes have contributed to the dollar's strength. In contrast, Europe faces challenges, including high energy prices and rising debt concerns. These factors have influenced the currency markets, with investors adjusting their positions accordingly.
The dollar's performance against major currencies has been significant, with some experiencing substantial losses. The Japanese yen, in particular, has seen a decline in its value against the dollar. The Bank of Japan and the US Treasury have taken steps to support the yen, which has had a temporary impact on its value.
As the currency markets continue to fluctuate, investors are monitoring the economic indicators and central bank actions. The US Federal Reserve's interest rate decisions will likely influence the dollar's value in the coming months. For now, the dollar remains strong, nearing its yearly high against the euro.
Key points
- The US dollar is nearing its highest level against the euro this year.
- The dollar's rise is attributed to strong US economic growth and higher interest rates.
- Europe faces increasing pressure related to energy and debt, impacting the euro's value.
