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End of Forexlive Americas FX news: Start of USD rally reverses.  Yields continue to climb


Markets:

  • Gold up to $12 to $1944
  • US 10-year rates up 5 basis points to 2.70%
  • WTI crude up $1.78 at $97.80
  • The S&P 500 loses 12 points to 4488
  • CAO leads, NZD lags behind

The U.S. dollar surged early in New York trading, then gave it all back.

The dollar’s recovery enjoyed some support as Treasury yields continued to climb. Yields on the belly of the curve hit new cycle highs with 7s hitting 2.81%. Three-year yields have also reversed above 30 years and this continues to cause concern.

A broad Dollar rally came with this and it came to a halt as the Cable fell to 1.3000 to the lowest since November 20202. sixth day of earnings. This, combined with an easing in yields, triggered a reversal as large as the initial move.

All of the dollar’s gains against the pound, euro and commodity currencies have unwound and most of the gains against the yen have done the same.

The reversal in tone was helped by a rise in stocks mid-day. That tone didn’t last through the close, however, as US stocks stumbled in the final minutes of trading.

The week ahead features US CPI and retail sales, which will help maintain momentum. Have a good week-end.


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