The U.S. dollar remains higher against most major currencies as bonds continue to slide, rising again in U.S. trading on Wednesday.
U.S. 10-year bond yields hit 4.60%, with the bond sale also weighing on broader market sentiment overall.
U.S. stocks and indexes, in particular, came under pressure yesterday before some purchases at the end of the session helped rally some indexes, especially the Nasdaq.
It's all about what's happening to bonds at the moment, and as long as yields continue to rise then expect the dollar to continue to benefit.
On the flip side was oil's only outstanding performance against the US dollar, with investors now looking to rally to $95 now.
Where the price rose another 1% today to currently $94.60, its highest since August last year, and then we're looking at the $100 level again.
Fears of a scarcity of global supplies were compounded by a sharp drop in U.S. crude inventories.
As European trading begins, we await inflation reports in Spain and Germany. That could affect a little bit what happens in bonds, but even if the numbers weaken we see that any drop in yields will be limited and temporary under the current momentum.
Either way, we expect that this will not change the European Central Bank's expectations of a rate hike in the upcoming meetings, which have become settled by no lifting.
