Dollar Slips as Pound Breaks Higher: GBP/USD Hits Fresh October High
The US dollar weakened sharply during the session, with the Dollar Index (DXY) falling 0.5% to 98.24, signaling renewed pressure across major FX pairs. At the same time, GBP/USD surged to 1.3457, marking its highest level since October 17 and confirming a clear upside breakout for the pound.
This move reflects a broader shift in market positioning. With US yields stabilizing rather than rising and expectations of future Fed easing still alive, the dollar is losing its short-term defensive appeal. Sterling, on the other hand, is benefiting from relative rate stability and improving sentiment toward UK assets, allowing it to outperform most majors.
What stands out is the timing. Liquidity is thinning into year-end, which tends to amplify directional moves. In such conditions, a 0.5% intraday drop in DXY carries more weight than usual, as it can accelerate trend-following flows rather than trigger quick reversals.
If the dollar remains under pressure, GBP/USD holding above this breakout zone could open the door for further upside extensions, especially if upcoming US data fails to revive yield support.