Dollar Selloff Accelerates as Risk Rally and Yen Surge Take Hold

The dollar has plunged as a strong risk-on rally and a sharp yen rebound reshape FX and equity markets. Big-tech earnings (notably Alphabet’s cloud growing 63%) have driven S&P 500 and NASDAQ to record highs, supporting risk assets and propping up commodity-linked currencies. At the same time USD/JPY reversed sharply after breaching 160 earlier in the week, with markets treating reports of Japanese authorities’ intervention as a de facto action and triggering aggressive short-covering and fresh yen longs. The combined flows have left the dollar broadly weak for the week while the yen is the top performer. Equity indices rose strongly overnight (Dow +1.62%, S&P +1.02%, Nasdaq +0.89%), 10-year U.S. yields moved lower (to ~4.39%), and 10-year JGB yields fell to ~2.506%. Overall the piece reads as market commentary highlighting dollar weakness, yen strength on intervention fears, and continued risk appetite driven by earnings.