Dollar Bulls in Control; Euro, Pound Extend Lows
The dollar extended its rally versus major peers as rising Treasury yields and confirmation of a Republican election clean sweep provided support ahead of a speech by Federal Reserve Chair Jerome Powell later Thursday.
The Bloomberg Dollar Spot Index is up for a fifth day, rises 0.3% to fresh cycle highs; Treasury yields rose across the curve, with those on 10-year notes advancing two basis points to 4.47%.
Spot flows run at around 70%-80% of recent averages, Europe-based traders say; dollar demand seen from a mix of names, with the leveraged community active another day.
EUR/USD drops 0.4% to 1.0518, fresh one-year low; DTCC shows $1.00-$1.14 straddle goes through in ~€300m, expiring July 3.
GBP/USD down 0.4% to 1.2656, lowest since July 2; cable set for seventh weekly drop, the longest losing streak in a decade.
One-year volatility extends gains to trade at 8.25% for the first time in a year.
USD/JPY up by as much as 0.4% to 156.14, highest since July 23.
Market is short gamma at these levels, with long positions slowly building up this week: trader.
USD/CHF +0.4% at 0.8896, near four-month high.
AUD/USD declines 0.4% to 0.6460; Australia’s run of hiring gains slowed in October, while the unemployment rate held steady, underscoring the resilience of the labor market to elevated interest rates.
Source : Bloomberg
