Dollar Near Two-Week High as Rate-Hike Bets Push Yen Beyond 160

Hong Kong, 31 August 2026 – The United States dollar is trading near a two-week high while the yen has weakened beyond 160 per dollar, as investors raise the probability of another US interest-rate increase. The shift is renewing pressure on Asian currencies and forcing companies and portfolio managers to reassess hedging, funding costs and the earnings impact of a stronger dollar.

Market pricing places the probability of a September rate increase at about 57%. The two-year US Treasury yield, which is particularly sensitive to policy expectations, has climbed to around 4.33%. Higher short-term yields improve the relative return on dollar assets and can attract capital away from lower-yielding markets, reinforcing currency moves even before a central-bank decision is made.