Forex – Dollar Hovering Near 5-Month Highs as Treasury Yields Support


© Reuters. Dollar hovering near 5-month highs as Treasury yields support

Investing.com – The dollar was hovering near its highest levels in five months against a basket of the other major currencies on Thursday as rising U.S. government bond yields continued to underpin demand for the currency.

The , which measures the greenback’s strength against a basket of six major currencies, was at 93.34 by 08:11 AM ET (12:11 AM GMT), within close reach of Wednesday’s highs of 93.52, the most since December 18.

The index is up around 0.93% so far this week.

The recent rise in the dollar has been fueled by a surge in U.S. government bond yields to multi-year highs.

The yield on rose as high as 3.122% on Thursday, the highest level since 2011. Bond yields move inversely to prices.

Yields have climbing higher since the Fed said at its May meeting that inflation is moving closer to its 2% target. The Fed raised rates in March and projected two more rate hikes this year, although many investors see three hikes as possible.

The euro remained on the back foot, with last at 1.1804, after plumbing a five month low of 1.1762 on Wednesday.

Sentiment on the single currency has been hit by concerns about the formation of a , that investors worry could increase the changes of the country exiting the euro.

The dollar advanced against the yen, with rising 0.25% to 110.66, a level not seen since January 23.

The pound was a touch higher, with last at 1.3514, off an overnight high of 1.3515.

British Prime Minister Theresa May said on Thursday that the UK would leave the European Union after Brexit, denying reports that London was considering applying the bloc’s external tariffs for a period beyond December 2020.

The Australian dollar pushed higher, with rising 0.17% to 0.7526, while the New Zealand dollar was little changed for the day, with at 0.6993.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Comments

comments