Dollar Falls as US Yields Slip
The dollar fell sharply against its rivals Monday, paced by declining U.S. bond yields, but the pullback could be short-lived as the expected rise in rates has forced some on Wall Street to ease their bearish bets on the greenback.
The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, fell by 0.48% to 92.61. Dollar Falls as US Yields Slip
U.S. bond yields slipped, though the 10-year yields remained above 1.7% after data showed U.S. services activity hit its highest level since 1997. The drag on the greenback from lower yields, however, is unlikely to continue in the wake of the positive economic backdrop.
“A backdrop of strong economic growth and rising inflation expectations may well see the U.S. yield curve continue to steepen. We continue to recommend a defensive posture in bonds,” Wells Fargo (NYSE:WFC) said.
Still, the road ahead for the greenback could be paved with uncertainty in the form of a potential rebound in the euro.
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