The Dollar chased the spike in US yields following a big tailing in the 30-year Treasury auction and hawkish comments by Fed Chair Jerome Powell. Economists at ING analyze USD outlook.
Some reassurances from the data side needed for another big jump in the USD
Dynamics across the US yield curve will have a big say in whether the Dollar can hold on to its new gains. Anyway, we had called for a recovery in DXY to 106.00 as the Fed would have likely pushed back against the dovish repricing.
The rebound in yields should put a floor under the Dollar, but we suspect some reassurances from the data side will be needed for another big jump in the USD.