Dollar at three-and-a-half-month high on firmer yields, U.S. growth
The U.S. dollar hit a 3-1/2-month high against a basket of currencies on Monday on expectations of strong U.S. economic growth and rising inflation, which also sent Treasury yields higher, boosting the greenback’s safe-haven appeal.
U.S. Commerce Secretary Gina Raimondo on Monday said a strong dollar was “good for America” and rejected calls for a weakening of the greenback.
10-year Treasury yield rises to roughly 1.6% after Senate passes stimulus package
The 10-year U.S. Treasury yield traded near the 1.6% level early Monday, after the Senate passed a $1.9 trillion coronavirus economic relief and stimulus bill on Saturday.
The yield on the benchmark 10-year Treasury note hit a high of 1.613% and last traded at 1.598%. The yield on the 30-year Treasury bond rose to 2.323%. Yields move inversely to prices.
U.S. Treasury yields were within striking distance of a one-year high above 1.62% hit on Friday, contrasting with German yields, which dipped nearly 5 basis points last week, pulling the euro to a near four-month low below $1.19.
The dollar index was up 0.53% at 92.38 against a basket of six major currencies, its highest level since Nov. 24.
The dollar held at a nine-month high against the yen, at 108.875 yen, and was near a one-month high versus the British pound, at $1.3839.
With the volatility in foreign exchange, Consumer Price Index data out on Wednesday and Producer Price Index data due Friday will be closely watched, as will 10-year and 30-year U.S. Treasury auctions on Wednesday and Friday, respectively.
Reference: CNBC
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