The returns on the 5-year notes, which are sensitive to rate hike expectations, reached the highest level since February 2020. Yields on 2-year debt, which also reflect market sentiment on interest rates, fell after hitting a 22-month high on Monday.
The dollar index advanced a marginal 0.06%, while the euro lost 0.05% to $ 1.1288. Against the yen, the dollar rose 0.65% to 116.08 yen, after reaching its highest since January 11, 2017 of 116.34.
Minneapolis Federal Reserve Chairman Neel Kashkari said he expects the central bank will need to raise interest rates twice this year to tackle persistently high inflation, reversing his long-standing view that rates they should stay close to zero until at least 2024.
Investors see Ómicron as potentially less destabilizing for the global economy than previous variants, following studies suggesting that the risk of hospitalization is lower.
The dollar index briefly trimmed its gains after data from the Institute of Management and Supply showed its national industrial activity index fell to a reading of 58.7 last month, below the estimate of 60.0. That was the lowest figure since last January and followed a reading of 61.1 in November.
Source From: Ambito
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