Yields finally weigh on the US dollar

<p>I have been waiting for signs to evaluate whether real money was going to FOMO into bonds and early returns suggest the appetite is there.</p><p>Yields retraced on Monday after last week's big fall but they're lower again today, led by a 12 bps fall at the long end. US 10s are down 11 bps to 4.55%, which is close to Friday's closing level. Today's <a href="https://www.forexlive.com/news/us-treasury-auctions-offer-48-billion-of-three-year-notes-at-a-high-yield-of-4701-20231107/" target="_blank" rel="follow">auction of 3s</a> met good demand.</p><p>My base case is that we will trace out a range in the 4.50-4.75% range until US economic data worsens but risks are now towards lower yields. In turn, that's weighing on the dollar and boosting risk trades.</p><p>Cable is benefiting in the past hour as it has bounced to 1.2302 from a low of 1.2263. Other US dollar moves are of a similar scope.</p>

This article was written by Adam Button at www.forexlive.com.