The dollar sat just below key resistance against most major currencies on August 13, 2026, while the Cboe Volatility Index closed at its lowest level since January. Central bank rates stayed wide apart, and futures positioning kept its familiar shape.
Where did the major currency pairs close?
The euro closed near 1.1526 against the dollar, just under the 1.1550 level traders have flagged as resistance. The pound sat at 1.3495, marginally above 1.3450. The dollar held firm above the yen at 159.457, and traded near 1.3924 against the Canadian dollar. The Swiss franc, Australian dollar, and New Zealand dollar all held close to their recent ranges.
Why is the VIX at a 7-month low, and what does that mean for risk appetite?
The Cboe Volatility Index closed at 14.45 on August 13, its lowest close since January. A falling VIX means traders are paying less to hedge against S&P 500 swings. That's usually a sign of rising risk appetite and complacency, not the low risk appetite a high VIX would signal. Low volatility regimes tend to compress currency ranges too, which lines up with majors sitting near well-worn resistance rather than breaking through it.
How wide is the rate gap between the Fed, ECB, BOE, and BOJ?
The Federal Reserve's target range holds at 3.50%-3.75%, with the effective rate running near 3.63%. The ECB held its deposit rate at 2.25% at its July 23 meeting. The Bank of England held at 3.75% on July 30. The Bank of Japan kept its policy rate at 1.0% in July, the highest level since 1995, after warning core inflation could exceed its 2% target.
What do Treasury yields show about the rate path?
The 10-year Treasury yield closed near 4.65% on August 13, pulling back from the prior session. The 5-year sat at 4.32%. Both remain well above the Fed's target range, a gap that keeps the dollar's carry advantage intact against lower-yielding currencies like the yen.
What does positioning in the futures market show?
The CFTC's weekly Commitments of Traders report, covering positions held the prior Tuesday, showed speculators still net long the euro heading into mid-August, though the size of that long has stayed thin by recent standards. Positioning in the pound, Swiss franc, and Canadian dollar remained net short, consistent with the safe-haven bid that shows up in the yen and franc whenever risk appetite cools even briefly.
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