US yields and the dollar have responded in a big way to strong US data that continues to defy logic. Talk of cautiousness and data dependency may fuel USD upside
The dollar is slightly softer at the time of writing but is coming off a massive two-day advance after Friday’s non-farm payroll report revealed a significant beat to the upside. The labour market not only looks robust but appears to be in the ascendancy after the December figure received a massive revision higher., appeared via the ISM services PMI readings below. The headline reading beat the forecast of 52 as well as the prior 50.
The above data is not consistent with an economy that ought to be constrained by elevated interest rates – suggesting that the start of rate cuts may need to be pushed back even further. As such, US yields and the dollar have risen in recent sessions.) is viewed as a benchmark of broader dollar performance and witnessed massive gains on Friday which continued into Monday. Today however, prices have eased back a tad, ahead of the 104.