Soaring U.S. bond yields may undermine the dollar’s safe haven status, Rabobank warns of long-term erosion risks

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智通财经2026/08/18 14:06

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Rabobank analyst Jane Foley pointed out that the continued sharp rise in U.S. Treasury yields could have a negative spillover effect on the U.S. dollar. Currently, the U.S. Treasury market is under multiple pressures including concerns over fiscal deficits, persistent inflation, and competition from corporate debt supply.
If selling pressure on U.S. Treasuries continues to intensify, its traditional status as a safe-haven asset may be put to the test, which would directly impact the U.S. dollar’s credibility as the world’s reserve currency.
In theory, the U.S. dollar's dominance in the global payment system should sustain its safe-haven function. However, Foley cautions that the trend of de-dollarization is quietly advancing worldwide. While this is a slow process, it could gradually erode its monopolistic position over several decades.
She warns that once the safe-haven attributes of the U.S. Treasury market weaken, the de-dollarization process could accelerate, putting the structural advantages of the dollar at risk of marginal weakening.
On Tuesday, the 30-year U.S. Treasury yield reached around 5.34%, the highest in 19 years, while the DXY U.S. Dollar Index remained steady near 99.6. The market is closely monitoring the impact of long-term interest rate movements on confidence in the dollar.

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Soaring U.S. bond yields may undermine the dollar’s safe haven status, Rabobank warns of long-term erosion risks

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