Dollar holds near two-month peak as yields rise, Fed data looms

The dollar index climbed to a two-month high of 101.2, poised for a 1.8% monthly gain, driven by rising Treasury yields and volatile oil prices, according to market reports. However, gains were capped as traders awaited US data releases, including PCE price index on Wednesday and nonfarm payrolls on Friday, to gauge the Federal Reserve's rate path.

The euro slipped to its weakest level in three months at US$1.1367, while the British pound remained steady near a three-month low. Oil prices rebounded, with Brent crude nearing US$106 a barrel, despite uncertainties in ending the Iran conflict after US President Trump rejected Iran's ceasefire proposal. Meanwhile, a surge in US Treasuries yields, reaching a two-year high since 2007 and a 30-year high since 2004, curbed dollar gains.

Analyst Joseph Capurso noted that forthcoming US economic data and a potential Federal Reserve rate hike could bolster the dollar. In other currency movements, the Australian and New Zealand dollars declined, and the Japanese yen weakened following Tokyo's stern warnings to Washington over the yen's value.