U.S dollar and yen notes
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U.S. bonds drove currencies on Wednesday, with a rise in long-term rates pushing the dollar to an almost four-year high on the yen, but a decline in shorter-dated yields putting it on the back foot against most other major peers.
The dollar and yen were also under pressure from a global equity rally that sapped demand for assets regarded as safe havens.
The dollar climbed as high as 114.585 yen for the first time since November 2017, with benchmark 10-year Treasury yields touching a fresh five-month high at 1.6630% in Asia. Higher long-term U.S. yields increase the allure of those assets to Japanese investors.
However, two-year Treasury yields hovered around 0.4050% after retreating sharply overnight from Monday’s 19-month high of 0.4480%, signaling a scaling back of bets for early Federal Reserve interest rate hikes.
That contrasted to a rise in wagers this week for faster rate increases in the U.K….
