US dollar stronger on more expensive US Treasuries

Posted 04 October, 2018

The US dollar is strengthening vs the majors at the Asian session. The positive dynamics of the greenback is related to increasing yield of 10Y US Treasuries, which has touched the top over the past 7 years.

The US dollar-to-yen exchange rate stands at some 114.32, while the yesterday's session saw the level of 114.53. For reference, the euro-to-yen rate was recorded at 131.26 (131.46 earlier).

The euro lost grounds against US dollar reaching some 1.1479 after hitting $1.1482 early today.

According to the avaiable data, the US 10Y Treasuries gained 3 basic points moving up to 3.21%, and thus exceeded the 3.2% line for the first time since 2011. The upturn is said to be driven by the message of Jerome Powell, US Federal Reserve Chairman, as the market considered it as a readiness for faster interest rate revision.

A representative of Chicago-based Federal Reserve bank stated that dramatic GDP rise and achieved target inflation (2%) can entail a further reduction of unemployment level which has already reached an all-time low, and thus consumer prices can face pressure.

Notably, the USA will release the September labour market report on Friday. However, the market analysts believe that the number of new jobs added 184,000 over the period under review, while the jobless rate dropped to 3.8%.

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04 October, 2018 12:04

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