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Dollar set for strongest week since November, yen steadies before polls
| USA | economy

Dollar set for strongest week since November, yen steadies before polls

#US Dollar #Artificial Intelligence #Federal Reserve #Japanese Yen #Bitcoin #Safe-haven assets #Market volatility

📌 Key Takeaways

  • The U.S. dollar hit a two-week high as investors fled a global rout in tech stocks and crypto.
  • Concerns over massive AI spending and the nomination of a hawkish Fed Chair fueled the market selloff.
  • The Japanese yen faced its worst week since October due to uncertainty surrounding an upcoming national election.
  • Bitcoin suffered a 14% weekly drop, marking its most significant decline since late 2022.

📖 Full Retelling

Global investors pivoted toward the U.S. dollar on February 6, 2026, driving the currency toward its strongest weekly performance since November as a massive rout in technology stocks and cryptocurrencies fueled a rush for safe-haven assets. This market turbulence was primarily triggered by disappointing corporate guidance regarding aggressive artificial intelligence spending and the nomination of Kevin Warsh as the next Federal Reserve Chair, which signaled a potentially more hawkish path for interest rates. The flight to the greenback occurred as traditional alternatives, such as the Japanese yen and Bitcoin, faced their own idiosyncratic pressures or sharp liquidations. The tech sector faced significant scrutiny following Amazon’s capital expenditure guidance, which exceeded analyst expectations and sparked fears that massive AI investments are not yet yielding sufficient productivity gains. This 'positioning flush' saw investors de-risking across multiple asset classes, leading to Bitcoin’s steepest weekly decline since 2022 and gold prices logging shaky gains after a bruising week. Market strategists noted that the dollar effectively became the 'best bet' for traders as safe-haven supply dwindled elsewhere in the financial system. In Japan, the yen stabilized slightly at 156.92 per dollar but remained on track for its worst weekly showing since October. Markets are particularly on edge ahead of a critical national election on Sunday, where a potential victory for Prime Minister Sanae Takaichi has raised concerns about fiscal expansion and burgeoning government debt. Analysts warn that an outsized win for Takaichi could lead to a reduction in consumption taxes, further straining the Japanese bond market and keeping the yen under significant selling pressure. Central bank activity in Europe and the UK also contributed to the week's narrative, with both the European Central Bank and the Bank of England electing to keep interest rates steady. While the euro and sterling saw modest recoveries on Friday, they remained overshadowed by the dollar's dominance. Looking ahead, investors are awaiting the delayed U.S. payrolls report for January, which is expected to offer crucial insights into whether the world's largest economy is losing enough momentum to justify interest rate cuts in the first half of the year.

🐦 Character Reactions (Tweets)

Market Maven

The dollar is like that overachiever in school, finally getting the recognition it deserves while Bitcoin is left to sulk in the corner. #SafeHavenDrama

Capital Crusader

So the yen decided to show up to the party dressed in last year’s fashion? Good luck stabilizing before the election, buddy! #CurrencyCatwalk

Crypto Comedian

Bitcoin just went through the emotional rollercoaster of the century! Should we tell it there's a support group for volatile assets? #BTCBlues

Interest Rate Insider

Kevin Warsh stepping into the Fed chair is like having that friend who loves to organize everything—everyone’s in a frenzy, but at least we know exactly when it will get done! #FedChairFollies

💬 Character Dialogue

GLaDOS: How delightful; the dollar is thriving while the technology stocks crash. It's almost as if investors have a penchant for watching trains derail.
Геральт із Рівії: Hm, they flee to the dollar like it's a monster under their bed. Can’t say I blame them—better a known beast than an unknown horror.
ГлаDOS: Ah, the yen's performance mirrors that of a sad puppet. Perhaps Takaichi could use some corporate puppetry lessons. It's all about strings and manipulation, after all.
Джонні Сільверхенд: Or maybe Takaichi is just another cog in the corporate machine! Why do we even care about their puppet shows? Let’s burn the scripts!
Геральт із Рівії: Hm, and as the world spins around these financial farces, we mere hunters deal with real monsters. It's a different kind of survival.

🏷️ Themes

Global Finance, Tech Volatility, Monetary Policy

📚 Related People & Topics

Japanese yen

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📄 Original Source Content
try{ var _=i o; . if(!_||_&&typeof _==="object"&&_.expiry Amazon stock slides 9% premarket as 2026 capex guidance blows past expectations Gold, silver prices log shaky gains after bruising week 3 reasons why Bitcoin is falling Amazon’s capex plans, Stellantis, Bitcoin’s fall - what’s moving markets (South Africa Philippines Nigeria) Dollar nears two-week high as AI splurge spooks investors Economy Published 02/05/2026, 08:23 PM Updated 02/06/2026, 04:25 AM Dollar nears two-week high as AI splurge spooks investors 0 Euro US Dollar 0.17% British Pound US Dollar 0.33% Gold Spot US Dollar 2.01% Japanese Yen US Dollar 0.00% DX -0.03% GC 0.19% JGB -0.05% Bitcoin US Dollar -7.23% By Amanda Cooper LONDON, Feb 6 - The dollar held near two-week highs on Friday, drawing on its safe-haven appeal, as investors rushed to unwind some of their riskier positions following a deep rout in stocks, crypto and precious metals driven by concerns over a surge in AI-related spending this year. The Japanese yen edged up, but was still headed for its worst weekly performance against the dollar since October and has given up most of late January’s hefty gains, as traders brace for Sunday’s national election. Global shares have seen their biggest weekly selloff since November, as investors fret about the massive spending on artificial intelligence as well as the cascading impact of fast-advancing AI tools that could upend various sectors. Classic safe-havens like gold and alternatives like bitcoin have been caught up in the backlash, while go-to haven currencies like the yen and the Swiss franc have also not had the same draw, City Index strategist Fiona Cincotta said. "The timing of the recovery is coinciding with the tech rout that we’re seeing. So it stands to reason that you’re going to see some safe-haven flows going into the U.S. dollar," she said. "And especially because the Japanese yen is under pressure because of nervousness surrounding the election this weekend, it does mean that, fo...

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