Connect with us

Hi, what are you looking for?

Investing Ideas

Dollar off recent highs as investors look to Fed, Yellen for bond clues

Economy17 minutes ago (Mar 22, 2021 09:55PM ET)

(C) Reuters. FILE PHOTO: A picture illustration shows U.S. 100 dollar bank notes taken in Tokyo

By Hideyuki Sano

TOKYO (Reuters) – The U.S. dollar hovered below recent highs on Tuesday as investors looked to fresh comments from top U.S. policy makers to gauge how far they would allow U.S. bond yields to rise.

The Turkish lira showed some sign of stability following a 7.5% dive on Monday after President Tayyip Erdogan sacked a hawkish central bank chief.

The dollar traded at 108.81 yen, having lost a bit of steam after it had hit a nine-month peak of 109.365 last week. The euro stood at $1.1934, having bounced off a two-week low of $1.1870 on Monday.

The dollar’s index against a basket of six major currencies slipped 0.32% on Monday and stood almost flat in early Asian trade at 91.815.

The index has gained 2.0% so far this quarter, as speedy rollouts of COVID-19 vaccines in the United States and the Biden Administration’s $1.9 stimulus are seen lifting the country’s economic growth, helping to drive up U.S. bond yields and drawing investors to the dollar.

The dollar’s attraction was further boosted as U.S. Federal Reserve officials appeared to tolerate rises in bond yields in recent weeks.

“U.S. bond yields could rise further as the market may try to find out where the pain threshold for the Fed is,” said Minori Uchida, chief currency analyst at MUFG Bank.

The immediate focus is on the Congressional testimony by Federal Reserve Chair Jerome Powell and Treasury Secretary Janet Yellen later today.

For now, though, the 10-year U.S. bond yields eased to 1.684% after peaking at 1.754% on Thursday, keeping the dollar in check.

“The market is interested in how far U.S. bond yields will rise. While top Fed officials have said they will keep interest rates low through 2023, there could be dissenting voices,” said Yukio Ishizuki, senior strategist at Daiwa Securities.

The Turkish lira traded at 7.7980 per dollar after a steep fall on Monday to as low as 8.485, near its record low of 8.58.

The lira’s massive fall, however, did little to shake investors’ confidence in emerging market currencies as the event, the third firing of a central bank chief by Erdogan since 2019, was not perceived to hold wider risk.

The MSCI emerging market currency index dipped only slightly on Monday.

Bitcoin stood at $54,549, having fallen almost 5% on Monday to trade near last week’s low of $53,221.

Dollar off recent highs as investors look to Fed, Yellen for bond clues

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

You May Also Like

Uncategorized

Neque porro quisquam est, qui dolorem ipsum quia dolor sit amet, consectetur, adipisci velit, sed quia non numquam eius modi tempora incidunt.

Uncategorized

Nemo enim ipsam voluptatem quia voluptas sit aspernatur aut odit aut fugit, sed quia consequuntur magni dolores eos qui ratione.

Uncategorized

Quis autem vel eum iure reprehenderit qui in ea voluptate velit esse quam nihil molestiae consequatur, vel illum qui dolorem eum.

Uncategorized

Neque porro quisquam est, qui dolorem ipsum quia dolor sit amet, consectetur, adipisci velit, sed quia non numquam eius modi tempora.

Disclaimer: Wisegazette.com it's managers and its employees (collectively "The Company") do not make any guarantee or warranty about what is advertised or above. Information provided by this website is for research purposes only and should not be considered as personalized financial or health advice. Copyright © 2021 Wise Gazette. All Rights Reserved