Dollar at strongest since 2003; bond selloff resumes | Reuters

By Rodrigo Campos | NEW YORK NEW YORK The U.S. dollar climbed on Friday to its highest level since 2003 on continued bets on faster inflation and higher interest rates, while Treasuries resumed a selloff that left benchmark yields on track for their steepest two-week increase in 13 years.A growing perception that the economic policies of U.S. President-elect Donald Trump will lift consumer prices pushed the dollar higher.On Wall Street, the tech- and biotech-heavy Nasdaq Composite hit a record intraday high before slipping lower

Reuters November 19, 2016 03:00:06 IST
Dollar at strongest since 2003; bond selloff resumes
| Reuters

Dollar at strongest since 2003 bond selloff resumes
 Reuters

By Rodrigo Campos
| NEW YORK

NEW YORK The U.S. dollar climbed on Friday to its highest level since 2003 on continued bets on faster inflation and higher interest rates, while Treasuries resumed a selloff that left benchmark yields on track for their steepest two-week increase in 13 years.A growing perception that the economic policies of U.S. President-elect Donald Trump will lift consumer prices pushed the dollar higher.On Wall Street, the tech- and biotech-heavy Nasdaq Composite hit a record intraday high before slipping lower. The Dow industrials and S&P 500 were also near record highs despite the day's decline."People are still trying to wrap their arms around what the U.S. elections mean for policy going forward," said Jason Pride, director of investment strategy at Glenmede in Philadelphia."This market is supportive of equities because we're in an ongoing economic expansion. Earnings are improving. Valuations on the whole might be a little rich in the U.S., but the market can still see good returns even at these valuations."The Dow Jones industrial average .DJI fell 13.83 points, or 0.07 percent, to 18,889.99, the S&P 500 .SPX lost 3.25 points, or 0.15 percent, to 2,183.87 while the Nasdaq Composite .IXIC dropped 9.07 points, or 0.17 percent, to 5,320.83.The pan-European FTSEurofirst 300 index .FTEU3 fell 0.54 percent, while MSCI's gauge of stocks across the globe .MIWD00000PUS fell 0.44 percent.Emerging market stocks .MSCIEF fell 0.3 percent and remained near a four-month low hit Monday.

The U.S. dollar's rise against the yen JPY= raised hopes of an earnings boost to Japanese exporters, helping lift the Nikkei average .N225 to a 10-month high. The blue-chip Japanese stock index closed 0.6 percent higher. BOND SELLOFF RESUMES, GREENBACK FLIES
Last week's unexpected U.S. election victory from political neophyte Donald Trump has led to a repricing of assets, most notably in currency and bond markets.

Federal Reserve policymaker James Bullard said on Friday he is leaning towards supporting a rate rise in December, adding that a plethora of potential changes under Trump could affect future policy.The euro EUR= fell 0.3 percent to $1.0593, while the yen JPY= weakened to 110.73, having earlier fallen to 110.92 per dollar. Against the Chinese yuan, the greenback hit 6.895 CNY=CFXS, its highest since mid 2008.The dollar index .DXY hit a high of 101.48, its highest level since April 2003. It has risen over 4 percent in the last two weeks, its biggest fortnightly rise since March 2015.The election outcome briefly spooked financial markets worldwide but they quickly reversed course as traders seized on tax cuts, deregulation and infrastructure spending which Trump campaigned on as positives for the greenback.

"It has caused a wave of dollar buying across the board," said Richard Scalone, co-head of foreign exchange at TJM Brokerage in Chicago.To be sure, it is unclear how many if any of these proposals would materialize. Trump's stance on immigration and trade, if they become law, could hurt the dollar, analysts said.The 10-year U.S. Treasury yield US10YT=RR rose to 2.355 percent, its highest since December. It is up near 50 basis points over the last two weeks - the biggest such rise in 13 years. Benchmark 10-year notes US10YT=RR last fell 18/32 in price.U.S. crude CLc1 last rose 0.3 percent to $45.56 a barrel and Brent LCOc1 traded at $46.76, up 0.6 percent on the day.Spot gold XAU= fell 0.6 percent to $1,208.68 an ounce. U.S. gold futures GCcv1 fell 0.7 percent to $1,208.40 an ounce.Copper CMCU3 fell 1.3 percent to $5,423.15 a tonne. (Reporting by Rodrigo Campos; additional reporting by Sinead carew, Richard Leong and Dion Rabouin; Editing by Nick Zieminski)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

also read

UK medical officers give nod for COVID-19 vaccines for children aged 12 to 15
World

UK medical officers give nod for COVID-19 vaccines for children aged 12 to 15

The medical officers said their recommendation to the government was made after considering "what effect this will have on transmission in schools and effects on education"

Australia cuts French submarine deal for US nuclear fleet; Scott Morrison cites 'changed strategic environment' as reason
World

Australia cuts French submarine deal for US nuclear fleet; Scott Morrison cites 'changed strategic environment' as reason

Australia's submarine upgrade was a response to China’s takeover of the South China Sea, aggressive bullying of Australia and intimidation of Japan and Taiwan, said Peter Jennings.

Submarine deal row: France accuses Australia, US of lying and duplicity
World

Submarine deal row: France accuses Australia, US of lying and duplicity

The move comes after Australia's decision to break a 2016 deal for French submarines in favour of American nuclear-powered vessels