NEW YORK, Jan 4 (Reuters) – The U.S. dollar rose for a fifth straight day against the Japanese yen on Tuesday, hitting a five-year high as investors viewed the Omicron variant as not likely to derail the global economy or delay the Federal Reserve’s expected rate hikes.
A rise in U.S. Treasury yields on expectations for a Fed rate hike this year have supported the greenback, with those foreseeing at least a 25-basis-point hike at the March meeting of the central bank’s policy-setting committee topping 60%, the CME FedWatch Tool found.
Yields on U.S. 5-year notes , which are sensitive to rate hike expectations, reached the highest level since February 2020. Yields on U.S. 2-year notes , which also reflect the market’s view on interest rates, edged lower after touching a 22-month high on Monday.
The dollar index rose 0.06%, with the euro down 0.05% to $1.1288.
The Japanese yen weakened 0.65% versus the greenback at…