Cyber Outage Jolts Global Markets, Sends Dollar Higher

The dollar surged on Friday amid a global cyber outage impacting banks, airlines, and broadcasters, causing investor unease. Despite the volatility, currency market disruptions remained limited. London's market saw significant disruptions, and technology stocks suffered amidst rate cut expectations from the Federal Reserve. The yen also experienced movements due to suspected official interventions.

The dollar surged in volatile trading on Friday as a global cyber outage affecting banks, airlines, and broadcasters unsettled investors. However, currency market volatility remained contained. London's financial hub was particularly affected, with LSEG Group experiencing disruptions in user access to some of its products.

The week's risk aversion has notably impacted technology stocks, while expectations for a possible Federal Reserve rate cut in September have also pressured the dollar. This rate disparity between the U.S., Japan, and Switzerland has prompted investors to sell low-interest-rate currencies for higher-yielding assets.

Meanwhile, the yen gained strength, notably through suspected interventions by Japanese authorities. Inflation data showing rising prices in Japan heightened expectations for decisive monetary action from the Bank of Japan. In the UK, retail sales data and mixed economic signals complicated the Bank of England's rate cut considerations.

(With inputs from agencies.)