Dollar Forecast: Yields, Risk Sentiment Set Currency Tone

Currency markets are increasingly shaped by the bond selloff, with 10-year Treasury yields marking their worst run in over a century. Rising yields make dollar-denominated assets more attractive, a dynamic reinforcing bullish USD forecasts across major pairs.

Meanwhile, risk sentiment tied to geopolitical bets on Iran adds a layer of uncertainty. The market's long-standing assumption that tensions de-escalate quickly is being tested, and a failure of that pattern could trigger safe-haven flows that complicate near-term forex forecasts.

Combined with hawkish central bank repricing in the US, these macro threads suggest volatility will remain elevated across G10 currency pairs in coming sessions.