The U.S. dollar slipped from a one -week high, following a 10 -year decline in U.S. treasury yields ahead of U.S. Federal Reserve (Fed) Chairman Jerome Powell’s speech tonight.
The benchmark 10 -year bond yield hovered around 1.67%, allowing the US dollar to retreat from record highs and global stocks to return to stability.
Meanwhile, US President Joe Biden is reportedly going to consider a new economic plan that includes infrastructure spending as well as tax increases.
In addition, market attention is also targeted at Powell and Treasury Secretary Janet Yellen who will also testify before the House Services Committee on Tuesday and the Senate Banking Committee on Wednesday.
Even with the depreciation of the US dollar, however, the Aussie dollar and kiwi failed to capitalize on the opportunity to rise by trading horizontally due to pressure by weak commodity prices.
Steel production in China is limited due to concerns over pollution and this has put pressure on demand for iron ore which is Australia’s largest export to China.
The pound rose slightly but the rise was limited due to recent pressure from the European Union (EU) threatening to halt vaccine exports to the UK. This could affect vaccination programs in the UK.
Prime Minister Boris Johnson also plans to extend the sanctions until October compared to June previously estimated.
