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US Dollar Index and US Treasury Yields Are Weak Early on July 31

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Jul. 31 2018, Updated 8:05 a.m. ET

US Dollar Index

After closing higher last week, the US Dollar Index started this week on a weaker note by declining on Monday. Maintaining the weakness, the US Dollar Index opened Tuesday on a mixed note and was consolidating near opening prices in the early hours.

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Market sentiment

The US Dollar Index was weak ahead of major central bank meetings and economic releases scheduled for this week. The euro’s recovery on Monday also weighed on the US Dollar Index. On July 31, the Bank of Japan kept the interest rates unchanged and tweaked its stimulus program. The Fed will finish its interest rate meeting on August 1. The Fed is widely expected to keep the interest rates unchanged. The market is looking forward to the release of the personal consumption expenditure price index as well as personal income and spending data. The data are scheduled to be released at 8:30 AM EST today.

At 5:25 AM EST on July 31, the US Dollar Index was trading at 94.31—a drop of 0.02%.

US Treasury yields

US Treasury yields moved higher on Monday and started this week on a stronger note. Although the market doesn’t expect the Fed to increase the interest rates this time, the market expects the Fed to reaffirm two more interest rate hikes in 2018. However, Treasury yields pulled back in the early hours on July 31.

Below are the movements in the Treasury yields as of 5:30 AM EST on July 31.

  • The ten-year Treasury yield was trading at 2.958—a drop of ~0.57%.
  • The 30-year Treasury yield was trading at 3.078—a drop of ~0.86%.
  • The five-year Treasury yield was trading at 2.843—a drop of ~0.25%.
  • The two-year Treasury yield was trading at 2.665—a drop of ~0.13%.

The iShares 20+ Year Treasury Bond (TLT) fell 0.34%. The ProShares UltraShort 20+ Year Treasury (TBT) and the ProShares UltraPro Short 20+ Year Treasury (TTT) rose 0.78% and 1.18%, respectively, on July 30.

Next, we’ll discuss how commodities performed in the early hours on July 31.

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