The surge in US bond yields has lifted greenback dollar trading to rebound after falling to a nine -week low due to the outcome of the FOMC policy meeting.
10 -year U.S. treasury yields jumped to 1.68% in the New York session after seeing strong U.S. economic growth data readings.
Gross Domestic Product (GDP) increased by 6.4% in the first quarter of this year from 4.3% recorded in the previous quarter, driven by a significant increase in consumer spending.
This proves that the results of massive stimulus measures by the government and central banks, as well as advances in vaccination have helped drive this growth.
Meanwhile, in a separate report, the number of U.S. jobless claims continued to show a decline to 553,000 last week.
At the time of writing, the dollar index is trading steady around 90.60, down slightly from the gains recorded in the previous session of 90.77.
Earlier, the currency depreciated lower following a statement by Federal Reserve (Fed) Chairman Jerome Powell who dismissed speculation of reducing earlier bond -buying easing, on the grounds that jobs were still far from target.
The statement provided an opportunity for the euro to soar to its highest level since February, before it eased gains following the rise of the USD.
Nevertheless, the US dollar is now on track to record a fourth consecutive weekly decline against its major rivals.