Bitcoin resilience tested as U.S. dollar climbs to 18-month high
Markets
Bitcoin resilience tested as U.S. dollar climbs to 18-month high
A stronger dollar and rising bond yields could be headwinds as fiscal concerns in France and political uncertainty in Spain weigh on the euro.
By James Van Straten|Edited by Jamie Crawley
Updated Oct 5, 2026, 7:32 a.m. EDTPublished Oct 5, 2026, 6:44 a.m. EDT
2 min readMake preferred on ShareShare this article
Copy linkX iconX (Twitter)LinkedInFacebookEmail
Make preferred on
Summary
Show
The DXY reached roughly 102.5 on Monday, an 18-month high.
The euro fell to a 17-month low against the dollar as Spain’s snap election added to political uncertainty.
Bitcoin is holding near $86,000 despite tighter financial conditions
Major currencies typically move less sharply than stocks or cryptocurrencies, but shifts in monetary policy and investor confidence can trigger explosive moves.
The U.S. Dollar Index (DXY), which measures the dollar against a basket of six major currencies, reached roughly 102.5 on Monday, its highest level in nearly 18 months. Having climbed from around 99 in early September, it is now comfortably above its 200-day moving average, also near 99, a signal of strengthening bullish momentum.
A stronger dollar typically creates headwinds for risk assets by increasing the cost of servicing dollar-denominated debt outside the U.S. and reducing overseas investors’ purchasing power. When accompanied by higher U.S. interest rates, it also makes cash and government bonds more attractive, raising the hurdle for investing in stocks and bitcoin BTC$85,510.61.
The Federal Reserve’s September decision to raise rates by 25 basis points to 3.75% to 4% has helped underpin the dollar’s strength. Markets are pricing in further tightening, with a target range of 4.5% to 4.75% emerging as the most likely outcome by June 2027. This rising Treasury yields, alongside concerns over inflation, government borrowing and fiscal sustainability. Long-term U.S. yields have reached levels last seen more than two decades ago.
Euro weakness is another major driver because the it accounts for 57.6% of the DXY basket. The euro has fallen towards 1.12, a 17-month low, as mounting fiscal and political concerns weigh on confidence. France faces increasing pressure over its deficit and borrowing costs ahead of next year’s presidential election. Meanwhile, Spanish Prime Minister Pedro Sánchez has called a snap election for Nov. 29, adding to regional uncertainty.
Despite these headwinds, bitcoin continues to hold around $86,000 after a strong start to October.
Newsletters
Crypto Daybook Americas - The latest moves in crypto markets, in context
Market analysis for crypto traders and investors.
Preview
Sign up
By signing up, you will receive emails about CoinDesk products and you agree to our terms & conditions and privacy policy.
Bitcoin News
Related Assets
Bitcoin$85,510.610.44%
Latest Crypto News
1Peter Thiel-backed Founders Fund leads a $5 million token buy in crypto collateral protocol Anvil7 hours ago
2Crypto is expanding the boundaries of what can be priced7 hours ago
3OKX draws investment from StanChart, Circle, Ripple as it pushes beyond crypto exchange roots8 hours ago
4Arbitrum joins Paxos-led stablecoin group Global Dollar to capture digital dollar growth11 hours ago
5Self-styled 'Godfather' gets 6 years in prison for $37 million Meta fraud scheme11 hours ago
6The VIX of bonds is rising but bitcoin and stocks aren't hearing it yet12 hours ago
7Live updates: Bitcoin remains locked in range as stocks notch another new record high13 hours ago
8Smaller altcoins shine as bitcoin stills trades around $85,00013 hours ago
9U.S.- China AI race heats up as Chinese rivals secure billions ahead of IPOs14 hours ago
10OKX looks to abstract blockchain mechanics to bring stablecoin balances to everyday consumers15 hours ago
Latest Research
The Definitive Stablecoin Landscape Series: Asia Pacific
The Definitive Stablecoin Landscape Series: Asia Pacific
As stablecoins move into regulated finance, APAC is becoming a key proving ground. This report maps the region’s rules, use cases, and RLUSD’s role.
By CoinDesk Research
Sep 15, 2026
Commissioned byRipple
As stablecoins move into regulated finance, APAC is becoming a key proving ground. This report maps the region’s rules, use cases, and RLUSD’s role.
Why it matters:
As stablecoins move into regulated finance, APAC is becoming a key proving ground. This report maps the region’s rules, use cases, and RLUSD’s role.
View Full Report
More From Markets
Live updates: Bitcoin remains locked in range as stocks notch another new record high
Smaller altcoins shine as bitcoin stills trades around $85,000
U.S.- China AI race heats up as Chinese rivals secure billions ahead of IPOs
More From Bitcoin
Peter Thiel-backed Founders Fund leads a $5 million token buy in crypto collateral protocol Anvil
Crypto is expanding the boundaries of what can be priced
OKX draws investment from StanChart, Circle, Ripple as it pushes beyond crypto exchange roots
