Dollar Dive: Global Markets on High Alert

The dollar took a hit as President Trump's comments dismissed concerns about its weakness, sending the euro and Australian dollar soaring. Meanwhile, gold surged to a record high, and markets focused on Federal Reserve's rate-setting meeting. Equities reached new heights amid economic optimism.

The global financial landscape witnessed a seismic shift as the dollar experienced significant depreciation amid indifferent remarks by U.S. President Donald Trump. His nonchalant attitude toward the dollar's weakness resulted in a flurry of activity in various markets, with the euro surpassing $1.20 for the first time since 2021, and the Australian dollar reaching a three-year peak.

As traders adjusted to the currency volatility, the ailing yen found some support, albeit temporary, before the dollar regained momentum. This selloff, the sharpest since the tariff disturbances of the previous year, was exacerbated by erratic U.S. policymaking, Federal Reserve tensions, and recent indications of possible dollar sales to support yen strength.

Additional ripples were observed as gold prices soared to unprecedented levels while bitcoin lagged behind, staying below $90,000. Stock markets, on the other hand, thrived, with the S&P 500 and Hong Kong's Hang Seng hitting new highs amidst optimism about upcoming big tech earnings and evolving economic conditions around the globe.

(With inputs from agencies.)