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US Dollar Index and US Treasury Yields Are Strong

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US Dollar Index

After rising for two consecutive trading weeks, the US Dollar Index started this week on a stronger note and rose in the first three trading days. The US Dollar Index is stable in the early hours on September 28, 2017.

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Market sentiment

The market sentiment on the US Dollar Index improved last week amid the FOMC’s hawkish meeting statement. The sentiment strengthened this week amid Fed Chair Janet Yellen’s hawkish comments on interest rates and inflation. There’s a higher chance of one more interest rate hike by the end of 2017. The US Dollar Index rose to one-month high price levels on September 27 after President Trump announced tax reform plans. The market is looking forward for the release of US GDP, goods trade balance, and initial jobless claims data at 8:30 AM EST today.

At 7:10 AM EST on September 28, the US Dollar Index was trading at 93.25—a fall of 0.12%.

US Treasury yields

Despite starting this week lower, US Treasury yields regained strength and rose as the week progressed. The improved market sentiment amid President Trump’s tax reform plans and a higher chance of an interest rate hike in December are supporting Treasury yields. The Treasury yields are strong in the morning session.

Movement in Treasury yields

The movement in Treasury yields at 7:15 AM EST on September 28 was:

  • The ten-year Treasury yield was trading at 2.335—a gain of ~1.14%.
  • The 30-year Treasury yield was trading at 2.886—a gain of ~0.82%.
  • The five-year Treasury yield was trading at 1.928—a gain of ~0.45%.
  • The two-year Treasury yield was trading at 1.483—a gain of ~0.05%.

The iShares 20+ Year Treasury Bond ETF (TLT) fell 1.5%. The ProShares UltraPro Short 20+ Year Treasury ETF (TTT) rose 4.4%, while the ProShares UltraShort 20+ Year Treasury ETF (TBT) rose 3.0% on September 26.

In the next part, we’ll discuss how commodities performed in the early hours on September 28.

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