Dollar Demand Hits Strongest Level Since April 2025

Dollar demand reached its highest level since April 2025 as money markets react to recent volatility. Euro basis swaps fell to 0.625 percent on Tuesday.

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Money markets are exhibiting significant signs of strain following a week of extreme volatility, driving investor demand for the U.S. dollar to its highest levels since the market turmoil of April 2025. According to data from LSEG, three-month cross-currency basis swaps for the euro—a key derivative used to measure dollar demand—fell to 0.625% on Tuesday, a sharp decline from approximately 6.4% recorded late Monday.

An illustration featuring banknotes of the U.S. dollar, Euro, and British Pound, captured in May 2025. REUTERS/Dado Ruvic/Illustration/File Photo
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