Dollar Drifts Near Multi-Month Lows Amid Easing Treasury Yields
The US dollar has been drifting near multi-month lows against major peers on Wednesday as Treasury yields eased from recent highs. Investors are awaiting the release of minutes from the Federal Reserve's latest policy meeting for clues on interest rates.
The euro inched higher to $1.1577, remaining close to its two-month high touched earlier this week. Sterling was little changed at $1.3533, holding near a three-month high ahead of British inflation data due later on Wednesday, which is widely expected to show persistent price pressure.
The Japanese yen was little changed at 159.56 per dollar, having given back much of its intervention gains, but it remains well off a multi-decade low of about 164. The yield on the benchmark U.S. 10-year Treasury note extended declines and was last at 4.702%, while that on the 30-year bond fell to 5.282%.
Market participants now turn to the Federal Reserve's release of minutes from the most recent meeting of its monetary policy-setting Federal Open Market Committee later in the day, looking for clues as to policymakers' views on interest rates. Harvinder Kalirai, chief global fixed income and currency strategist at Alpine Macro, said that if the Fed does not follow through with rate hikes being discounted, 'the upside for bond yields should be very limited here.'