“The focus of attention right now is Treasury rates,” said Joseph Trevisani, senior analyst at FXStreet.com. “Credit markets expect the ‘taper’ (reduction in bond purchases) to start in November.”
The Investors will closely follow Wednesday’s US Consumer Price Index data and Friday’s retail sales data for more clues. on when the Federal Reserve will begin to reduce its stimulus.
The dollar index, which measures the greenback against a basket of other major currencies, rose to 94,519, its highest since the end of September 2020.
Rising yields in the United States sent investors dumping the yen against the dollar, causing the Japanese currency to fall on Monday.
On Tuesday, the dollar held near three-year highs against the yen, which has fallen 4% against the greenback in three weeks, as Treasury yields continue to rise.
“The main driver of this movement is the new rise in US Treasury yields, so this is a fairly simple story of a widening rate differential, which increases the attractiveness of the carry trade,” he said Ray Attrill, Head of Currency Strategy at National Australia Bank.
A Deutsche Bank monthly survey of market sentiment this month noted that an overwhelming majority of respondents expect US Treasury yields to rise from current levels.
The euro and the British pound were down 0.14% against the dollar, at $ 1.1537 and $ 1.3577 respectively.
In terms of cryptocurrencies, bitcoin was down 1.41% to $ 56,676 while Ether, the world’s second-largest cryptocurrency, was down 1.42% to $ 3,493.
David William is a talented author who has made a name for himself in the world of writing. He is a professional author who writes on a wide range of topics, from general interest to opinion news. David is currently working as a writer at 24 hours worlds where he brings his unique perspective and in-depth research to his articles, making them both informative and engaging.
