The dollar is scratching back some losses as US yields stabilize


© Reuters. FILE PHOTO: US $ 100 bills are featured in this image illustration

TOKYO (Reuters) – The US dollar rose on Wednesday, recouping some of its overnight losses as US yields bottomed after falling from a year high.

Riskier currencies like the Australian and New Zealand dollars fell on Tuesday after big gains. After hitting a previous high of $ 55,000 for the first time since February 22, it fell.

The safe haven dollar has been closely tracking spikes in government bond yields over the past few weeks, both as higher yields make the currency more attractive and because the bond route shattered investor confidence and fueled demand for the safest assets.

The benchmark stabilized on Wednesday in Asia after a three-day decline from an annual high of 1.6250% by 1.54%.

The reading rose 0.2% to 92.137 on Wednesday in Asia after falling sharply overnight from a 3-1 / 2-month high of 92.506.

Bond investors have been selling bets that a faster-than-expected economic recovery would trigger a spike in inflation. President Joe Biden is expected to sign a $ 1.9 trillion coronavirus aid package earlier this week.

Many analysts still expect the dollar to weaken later this year, but the pace of recent gains has forced some to adjust their views.

Westpac, which talked about selling the dollar index in 91 just last week, now hits 94.50 before resuming last year’s downtrend as the rest of the world bridges the gap on the US pandemic recovery.

“Global reflation is alive and well, and Europe will eventually bring its vaccination act together too,” Westpac strategists wrote in a note on Wednesday.

“A continuation of the global recovery … should lead to outperformance of the commodity currencies.”

It fell 0.4% to $ 0.7684 after rising 1% overnight.

New Zealand fell 0.4% to $ 0.7146 after rising 0.8% on Tuesday.

The euro fell 0.2% to $ 1.18810 after bouncing off a 3 1/2 month low of $ 1.18355 on Tuesday.

Against the yen, another traditional safe haven currency, the greenback rose 0.3% to 108.815 after retreating from a nine-month high of 109.235.

In cryptocurrencies, Bitcoin rose to $ 55,855 on Wednesday before falling back to $ 53,995. On February 21, it hit a record high of $ 58,354.14.

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Bid prices at 256 GMT

Description RIC Last US Close Pct Change YTD Pct High Bid Low Bid

Previous change

session

Euro / Dollar $ 1.1881 $ 1.1901 -0.16% -2.75% +1.1904 +1.1878

Dollar / Yen 108.8070 108.5100 + 0.28% + 5.35% + 108.8220 + 108.5250

Euro / Yen 129.28 129.10 + 0.14% + 1.86% + 129.3100 + 129.0700

Dollar / Swiss 0.9301 0.9280 + 0.22% + 5.12% + 0.9301 + 0.9279

Pound sterling / dollar 1.3861 1.3889 -0.18% + 1.48% +1.3891 +1.3861

Dollars / Canadians 1.2663 1.2640 + 0.22% -0.52% +1.2666 +1.2635

Aussie / dollar 0.7681 0.7721 -0.50% -0.14% +0.7718 +0.7678

NZ 0.7146 0.7176 -0.39% -0.46% +0.7181 +0.7147

Dollar / dollar

All positions

Tokyo spots

Europe spots

Volatilities

Tokyo Forex Market Information from BOJ

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