U.S. fiscal concerns and a tepid auction of Treasury bonds slapped the dollar to a two-week low versus the yen

The lacklustre 20-year bond sale reinforced the “Sell America” narrative, weighing on not just the dollar but Wall Street as well

U.S. fiscal concerns and a tepid auction of Treasury bonds slapped the dollar to a two-week low versus the yen on Thursday, while President Donald Trump tried to push his sweeping spending and tax-cut bill through Congress.

The lacklustre 20-year bond sale reinforced the “Sell America” narrative, weighing on not just the dollar but Wall Street as well, with traders already jittery after Moody’s cut the U.S. triple-A credit rating last week.

Bitcoin pushed to a fresh all-time high on Thursday, partly as investors sought out alternatives to U.S. assets. Gold also benefitted, reaching an almost two-week top of $3,325.79 and putting it within $175 of April’s record peak.

“Despite falling equities, the U.S. dollar has not seen traditional safe-haven demand, with gold, the euro and the yen instead benefiting,” said James Kniveton, a senior corporate FX dealer at Convera.

In the process of getting Trump’s bill to the Senate, “fiscal restraint could emerge, but market sentiment suggests scepticism,” he said.

Republicans are still divided over the details of the tax legislation. Hardliners within the party continue to argue the bill does not sufficiently cut spending, House Speaker Mike Johnson said.

The bill would add $3 trillion to $5 trillion to the country’s debt, according to nonpartisan analysts.

The dollar slipped to 143.27 yen early in Asia, the weakest level since May 7.

It turned lower despite an early pop of as much as 0.5% after Japanese Finance Minister Katsunobu Kato said he did not talk about foreign-exchange levels in his discussions with U.S Treasury Secretary Scott Bessent on the sidelines of the Group of Seven meetings in Canada.

However, the short-lived response suggests investor suspicions run so deep that the White House wants a weaker dollar versus many Asian currencies.

South Korea’s currency jumped to the strongest level since November 4 on Wednesday at 1,368.90 per dollar after the Korea Economic Daily reported that Washington had demanded that Seoul come up with measures to boost the won. It was trading a touch weaker at 1,377.00 on Thursday.

The euro was last flat at $1.1330, after rising 0.4% on Wednesday for a third straight session of gains.

Sterling was steady at $1.3426.

The Swiss franc ticked up 0.1% to 0.8245 per dollar.

Bitcoin was last 1.6% higher at $110,049.82, after earlier reaching a record high of $110,636.58.