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US Dollar Index Is Stable, US Treasury Yields Pulled Back

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Jul. 24 2018, Updated 9:44 a.m. ET

US Dollar Index

After a brief pullback last week, the US Dollar Index started this week on a stronger note by closing higher on Monday. Carrying forward the strength, the US Dollar Index opened Tuesday on a stable note. The US Dollar Index was trading with strength in the early hours.

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Market sentiment

The US Dollar Index fell at the end of last week and over the weekend amid comments from President Trump. President Trump criticized the Fed about raising interest rates gradually, which could take away the country’s competitive edge and hurt the economy. President Trump also accused the European Union and China of manipulating their currencies. However, the US Dollar Index rose on Monday amid a strong rally in Treasury yields. On Tuesday, the US Dollar Index is stable ahead of the release of July’s US manufacturing and services PMI data.

At 5:45 AM EST on July 24, the US Dollar Index was trading at 94.65—a drop of 0.02%.

US Treasury yields

US Treasury yields closed higher last week. On Monday, US Treasury yields moved higher amid expectations that the Fed would continue increasing the interest rates despite criticism from President Trump. US Treasury yields pulled back in the early hours on Tuesday. The market is awaiting the auction of four-week bills and two-year notes today.

Below are the movements in Treasury yields as of 5:50 AM EST on July 24.

  • The ten-year Treasury yield was trading at 2.950—a fall of ~0.49%.
  • The 30-year Treasury yield was trading at 3.085—a fall of ~0.57%.
  • The five-year Treasury yield was trading at 2.816—a fall of ~0.35%.
  • The two-year Treasury yield was trading at 2.629—a fall of ~0.16%.

The iShares 20+ Year Treasury Bond (TLT) fell 1.23%. The ProShares UltraShort 20+ Year Treasury (TBT) and the ProShares UltraPro Short 20+ Year Treasury (TTT) rose 2.39% and 3.63%, respectively, on Monday.

Next, we’ll discuss how commodities performed in the early hours on July 24.

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