U.S. dollar held near multi-month highs on Friday as investors warily awaited U.S. inflation data, while the pound nursed modest losses after Bank of England (BoE) policymakers leaned away from flagging rate rises.
Early Asia trade was steady, with the euro pinned below its 200-day moving average at $1.1930 and the yen just short of a 15-month low at 110.955 per dollar.
The dollar vaulted to its highest levels since March against the euro last week - and to its highest since March 2020 on the yen - after the U.S. Federal Reserve surprised markets by projecting interest rate rises sooner than expected in 2023.
The U.S. dollar index was steady at 91.833, off a week-ago high of 92.408 but clear of troughs below 90 that it had plumbed in May.
Sterling had started to move away from its post-Fed lows, but was the weakest G10 currency overnight and fell 0.3% after the BoE failed to provide any hint it was in a hurry to hike rates and warned against "premature tightening".
Bitcoin was steady at $34,380 and headed for a small weekly loss, as it has recovered most of a plunge below $30,000.
· 10-year Treasury yield edges higher ahead of inflation data
The 10-year U.S. Treasury yield edged higher early on Friday, ahead of the release of inflation data later in the morning.
The yield on the benchmark 10-year Treasury note rose slightly to 1.489% at 3:15 a.m. ET. The yield on the 30-year Treasury bond dipped slightly to 2.093%. Yields move inversely to prices.
· Near-term global bond market correction likely-strategists
A significant global bond market correction is likely in the next three months as central bankers eye the exit door from pandemic emergency policy, according to a Reuters poll of strategists who also forecast modestly higher yields in a year.
Financial markets were caught off guard by the Federal Reserve's surprisingly hawkish tone at its meeting last week, sparking a sell-off in equities and a safe-haven rush into Treasuries.
Reference: Reuters, CNBC
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