U.S. Dollar Appreciates As Treasury Yields Rise Amid Stimulus Optimism
12 March 2021 - 3:31PM
RTTF2
The U.S. dollar spiked up against its key counterparts during
the European morning session on Friday, as U.S. Treasury yields
rose after President Joe Biden's signing of a COVID-19 relief
package into law, boosting expectations for a faster growth and
inflation.
Biden signed the $1.9 trillion stimulus package on Thursday
afternoon, marking a major legislative victory since assuming
office in January.
The plan provides direct payments of up to $1,400, extends $300
per week jobless benefits and grant funds for vaccine
distribution.
In his signing ceremony, Biden pledged aggressive action to
speed vaccinations and move the country closer to normality by July
4.
U.S. bond yields firmed, with the benchmark 10-year Treasury
yields rising to 1.59 percent.
The U.S. producer price index and University of Michigan's
preliminary consumer sentiment index are due later in the day.
The greenback reversed from its early lows of 0.9231 against the
franc and 1.1989 against the euro, gaining to 0.9305 and 1.1928,
respectively. The next likely resistance for the greenback is seen
around 0.95 against the franc and 1.16 against the euro.
After falling to 108.49 against the yen and 0.7233 against the
kiwi in prior deals, the greenback advanced to a 3-day high of
109.17 and a 2-day high of 0.7179, respectively. The greenback may
face resistance around 112.00 against the yen and 0.70 against the
kiwi.
The greenback edged up to 1.3931 against the pound, from an
8-day low of 1.4005 set at 8:00 pm ET. Next immediate resistance
for the dollar is seen near the 1.37 level.
The greenback climbed to 1.2572 against the loonie and 0.7741
against the aussie, coming off from its early low of 1.2524 and an
8-day low of 0.7801, respectively. On the upside, 1.29 and 0.74 are
possibly seen as the next resistance levels for the greenback
against the loonie and the aussie, respectively.
Looking ahead, Eurozone industrial production for January is due
in the European session.
Canada jobs data and U.S. PPI for February and University of
Michigan's preliminary U.S. consumer sentiment index for March will
be featured in the New York session.
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