Treasury Intervention Shifts Costs to FX Market, Goldman: Dollar May Serve as Pressure Valve for US Fiscal Strain

Goldman Sachs believes that if risk premium on the US Treasury side is suppressed, that premium will inevitably seek an outlet, with the foreign exchange market becoming the most direct pressure point. Deutsche Bank also characterizes the buyback operation as "soft financial repression," structurally bearish for the dollar. From a technical indicator perspective, the dollar index remains trapped in range-bound consolidation, with the trend still unclear.