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US Dollar: Sentiment weighs on defensive currencies – ING

US Dollar: Sentiment weighs on defensive currencies – ING

101 finance101 finance2026/02/26 08:51
By:101 finance

ING’s Francesco Pesole notes that strong Nvidia earnings and buoyant equities have supported high‑beta currencies and pressured the Dollar, with only the Japanese Yen performing worse in G10. Oil price moderation and stable geopolitical risk pricing also limit safe‑haven demand. Pesole expects some Dollar stabilisation today, but still sees downside risks as markets stay tilted away from defensive FX.

Risk-on tone pressures safe havens

"Improved sentiment has weighed on the dollar over the past 24 hours, with only the yen taking a worse beating in G10 yesterday (more in the JPY section below). Oil price moderation is also playing a role, with markets seeing no reason to price in geopolitical escalation."

"Polymarket’s probability of a US strike on Iran by the end of March – the most accurate driver of oil prices of late – has been stable at around 60% for a few days now. At this stage, any escalation there looks like the most plausible catalyst for a broader dollar rally, given the reassurance from Nvidia’s results and the lack of major data releases."

"Overall, we could see some stabilisation in the dollar today, though some downside risks remain as the positive spillover from Nvidia’s earnings may keep markets tilted away from defensive currencies a little longer."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)

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Disclaimer: The content of this article solely reflects the author's opinion and does not represent the platform in any capacity. This article is not intended to serve as a reference for making investment decisions.

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