United States Dollar Index approaches 101.80 as bond yields keep rallying
The US Dollar continues to outperform its peers as United States (US) Treasury Yields keep rallying due to firm expectations of more interest rate hikes by the Federal Reserve (Fed) in the near term.
The US Dollar Index (DXY) is nearing its eight-week high of 101.30, driven by the rise in US Treasury yields. The 10-year Treasury yield is close to a 19-year high of 5.23%. Analysts attribute this surge to elevated energy prices and the Federal Reserve's (Fed) tightening policy, fueled by concerns over inflation and fiscal deficits.
Fed officials have expressed concerns about high inflation, and Fed Chairman James Bullard delivered a hawkish message in his speech recently. The DXY's strength is supported by strong demand, concerns over inflation, and the possibility of further rate hikes by the Fed. The Fed's communication remains supportive of the Dollar, despite uncertainty about the Fed's rate-path.
The Dollar Index Spot trades at 101.29, with a bullish near-term bias as price holds above the 20-day exponential moving average. However, the Relative Strength Index has entered overbought territory, suggesting strong upside momentum that could face a pause or consolidation.
Written by urgent.news from FXStreet's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
Also reported by 2 other outlets
- Australian Dollar tests 200-day SMA amid soaring US yields fxstreet.com
- Dollar set for weekly gains as yields surge freemalaysiatoday.com
