US Dollar Index Drops to 101.50 on Japanese FX Intervention

The US Dollar Index (DXY), which tracks the greenback against a basket of six major currencies, retreated to approximately 101.50 during the Asian session. The move ended a three-day advance for the dollar. Market participants attributed the decline to fresh foreign exchange intervention by Japanese authorities aimed at curbing yen weakness.

Intervention typically involves selling dollars and buying yen, which can directly pressure the DXY given the yen's significant weighting in the index. The dollar's reversal comes after a period of steady gains that had pushed the index higher earlier in the week.

Trading remained choppy as investors assessed the scope and duration of Japan's action. The yen strengthened broadly in response, though official confirmation from Tokyo is pending.