U.S. stock futures rose, the dollar fell to a four-year low, Asian currencies strengthened, and gold, copper, and aluminum all climbed.

U.S. stock futures rose, the dollar fell to a four-year low, Asian currencies strengthened, and gold, copper, and aluminum all climbed.

The weakening US dollar is reshaping the global market landscape. From precious metals to industrial metals to emerging market currencies, an asset rotation driven by "depreciation trades" is accelerating.

After the US dollar index fell to its lowest level since February 2022 yesterday, on Wednesday the 28th, the dollar rebounded slightly against all G10 currencies but remained in a weak range. Gold broke through $5,200/oz to hit a record high and has risen about 20% so far this year, while silver has soared more than 50%. Aluminum prices reached their highest in nearly four years, copper rose 1.4%, and zinc climbed 1.7%.

Asian currency markets have also benefited simultaneously. The MSCI Emerging Market Currency Index hit an all-time high, with the Malaysian ringgit and the Korean won leading the gains. The Federal Reserve's policy meeting on Wednesday became the market's focal point as investors seek further clues on the dollar's direction.

US stock futures rose, with Nasdaq 100 futures up over 1%, S&P 500 futures up 0.47%, and Dow futures up 0.1%.The Nikkei 225 closed up 0.05% at 53,358.71. The TOPIX index fell 0.8% to 3,535.49.Taiwan's weighted stock index closed up 1.5% at 32,803.82.Indonesia's stock market fell further to 8%, triggering a trading halt.The US dollar index rebounded 0.2% to 96.4.The Korean won rose against the dollar to its highest level since last October.The US 10-year Treasury yield fell 1 basis point to 4.23%.Japan's 20-year government bond yield fell 2 basis points to 3.180%. Japan's 10-year bond yield fell 3.5 basis points to 2.25%.Spot gold surpassed $5,250/oz, up 1.35% on the day; spot silver rose 3.44% to $115.82/oz.Aluminum prices rose 1.2% on Wednesday to $3,246.50/ton, at one point hitting $3,252 in early trading, the highest since April 2022. Copper rose 1.4%, zinc climbed 1.7%.West Texas Intermediate crude oil rose 0.7% to $62.81/barrel.

The Dollar's Continued Plunge Triggers Policy Concerns

The Bloomberg Dollar Spot Index plunged nearly 3% over the four trading days ending Tuesday, marking a near four-year low. This sell-off stemmed from growing unease about the Trump administration's erratic policymaking and ongoing attacks on the Federal Reserve.

US stock futures rose, with Nasdaq 100 futures up over 1%, S&P 500 futures up 0.47%, and Dow futures up 0.1%.

"The Trump administration is taking a calculated risk," said Win Thin, Chief Economist at Bank of Nassau 1982 Ltd. "The foreign exchange market is usually a leading indicator of market dissatisfaction with a country's policies and economic outlook, so this dollar weakness is worth noting."

Rob Kaplan, Vice Chairman at Goldman Sachs and former Dallas Fed President, warned in a Bloomberg TV interview in Hong Kong that while a weaker dollar benefits exports, the US has about $39 trillion in debt. "When you have that much debt, currency stability is more important than exports," he said. "The US wants to see a stable dollar, wants to be able to sell long-term government bonds. A stable dollar helps achieve that."

The Federal Reserve is expected to pause its rate-cutting cycle on Thursday, as a stabilizing labor market has rebuilt some consensus among officials. Chris Brigati of SWBC said that given the economy’s continued exceptional resilience, the Fed’s messaging will likely emphasize a data-driven approach to future policy decisions. Investors will also watch for its impact on the dollar.

Record Gold and Silver Rally Continues

The precious metals market is experiencing a surge not seen since 2026. On Wednesday, gold broke through $5,200/oz, continuing to set new records after surpassing the $5,000 mark earlier this week. A weak dollar, geopolitical uncertainty, and Trump's attacks on the Fed have reignited the "depreciation trade."

Silver's rally is even more astonishing, soaring over 50% so far this year, far surpassing gold's 20% gain. This precious metals bull market has attracted investors to shift from currencies and sovereign bonds to hard assets, driven by concerns about fiscal deficits.

Asian stock markets have also benefited from this asset rotation. The MSCI Asia Pacific Index rose 0.7% on Wednesday to a record high, with its technology stock index also hitting a new high, led by memory chip maker SK Hynix. Asian equities have continued their AI-driven three-year rally, and more attractive valuations along with stronger growth prospects have encouraged investors to shift into the region.

Aluminum, Copper, and Other Industrial Metals Strengthen Together

The base metals market is off to a robust start in 2026. Aluminum prices rose 1.2% on Wednesday to $3,246.50/ton, at one point hitting $3,252 in early trading, the highest since April 2022. Copper rose 1.4%, zinc climbed 1.7%.

Goldman Sachs raised its aluminum price forecast, saying the adjustment was made "after strong price performance and continued bullish investor sentiment." The bank expects the average aluminum price in the first half of the year to be $3,150/ton, up from its previous forecast of $2,575, though still below the current price. Goldman has been one of the more bearish commentators on the aluminum market in recent months.

Market analysts noted that "depreciation trades" are driving investors from currencies and sovereign bonds into hard assets, and Trump's erratic policymaking and attacks on the Fed have further fueled this trend. Supply constraints are providing additional support for some metals.

Asian Currencies Rally to Multi-Month Highs

Emerging Asian currencies hit their highest levels since last July on Wednesday as "dollar depreciation trades" accelerated. The Bloomberg Asia Dollar Index rose 0.4%, and the MSCI Emerging Market Currency Index hit a record high.

"Overnight dollar weakness was a key catalyst for the Asia-Pacific currency rally at today's open," said Wee Khoon Chong, APAC market strategist at BNY Mellon. "There are also stronger fundamental drivers, such as growth recovery momentum—especially in technology—and continued capital inflows into the region."

"Trump's latest comments on the dollar have further exacerbated dollar weakness," said OCBC currency strategist Christopher Wong. The risks for the US dollar against Asian currencies (except Japan) "are asymmetrically skewed toward the downside," unless the Fed surprises with hawkishness or risk sentiment deteriorates.

The strengthening of Asian currencies may provide some relief for currencies like the Philippine peso, Indian rupee, and Indonesian rupiah which are beset by deficit and fiscal concerns, Wee Khoon Chong added. The yen hit its strongest level since October during the US trading session on Tuesday after Japanese officials, including the Finance Minister, made comments that sparked speculation the government may intervene to prevent the currency from resuming its decline.

Risk warning and disclaimerMarkets are risky, and investments should be made with caution. This article does not constitute personal investment advice and does not take into account any individual user's specific investment objectives, financial situation or needs. Users should consider whether any opinions, views or conclusions in this article are suitable for their particular circumstances. Investing based on this information is at your own risk.