Dollar Surges on Treasury Yields, EUR/USD Loses Ground Amid Global Bond Market Sell-Offs
The U.S. dollar strengthened on Thursday as Treasury yields reached new highs, particularly for the 30-year yield at 5.57%. The DXY index moved away from session highs due to oil prices pulling back amid reports that Saudi Arabia restarted the key East-West pipeline.
Rising Treasury yields served as a catalyst in the forex market, with the 2-year Treasuries' yield climbing above 4.92% and the 10-year Treasuries' yield settling near 5.25%. The Dallas Fed Manufacturing Index report showed that the index declined from 11.6 in August to 9.8 in September, below analyst forecasts.
The EUR/USD pair is losing ground due to traders focusing on global bond market sell-offs, with Germany's 10-year bond yield reaching its highest level since 2009. In contrast, the GBP/USD pair is moving higher as Chancellor John Healey promised fiscal discipline ahead of his debut budget on October 28.
The USD/CAD pair continues to climb due to traders reacting to the strong sell-off in precious metals markets, with gold down by -3.6% and silver pulling back by almost 5%. The USD/JPY pair is mostly flat as traders evaluate their next moves amid global bond market sell-offs.