US Dollar Near 5-Month High, Boosted By Surge of Bond Yields
The US dollar is trading near a five-month high against major currencies, as the surge in 10-year Treasuries above 3% has again triggered the rally. The dollar's growth slowed last week after weaker than expected April inflation data, but soon resumed, as strong US consumer spending sent long-term US Treasury yields to a seven-year high of 3.095%.
The Japanese yen remained virtually unchanged after data showed that Japan's economy contracted for the first time in nine quarters. Japan's gross domestic product fell by 0.2% in the first quarter of 2018 after rising 0.1% in the fourth quarter of 2017. Year-on-year and seasonally adjusted, Japan's GDP declined 0.6% after rising 0.6% earlier (revised from 1.6%). Economists had expected a decline of 0.2%.
Gold prices recovered slightly after sliding to the lowest level in 2018 earlier, amid surging US Treasury yields and a stronger dollar. Gold was up $2.8, to $1,293.0.
Oil prices retreated from multi-year highs, pulled back by an industry organization’s comment that US crude stockpiles built unexpectedly last week. WTI crude oil was trading at $71.09 a barrel down 0.31%. Brent was down 0.24% at $78.24 per barrel.