Asian Currencies Consolidate as US Treasury Yields Hit Record Highs

Key Facts

1Asian currencies consolidated against the dollar in early trade as US Treasury yields hit new highs.

2MUFG Bank noted that oil prices are adding pressure to the rates story and Fed hike expectations.

Asian currencies consolidated against the US dollar in early trade as US Treasury yields reached new record highs. The Wall Street Journal reported that this stability occurs as expectations for further Federal Reserve interest rate hikes continue to support the greenback.

MUFG Bank noted that elevated oil prices are adding to inflationary pressures, strengthening the case for tighter US monetary policy. Higher US yields typically drive capital outflows from emerging markets, maintaining downward pressure on regional Asian FX pairs.