Dollar moves in a positive zone as US treasury yields gian ground

Dollar rose in European trade on Monday against a basket of major rivals, resuming movements in the positive zone as US 10-year treasury yields powered up.

Markets are now focused on upcoming US data later this week to  gather more clues on the future of US interest rates.

The Index 

The dollar index rose 0.15% today to 106.28, with a session-low at 105.98, after closing down 0.1% on Friday as the threat of an Iranian-Israeli war subsides. 

 The index advanced 0.1% last week, the second weekly profit in a row.

US Yields 

US 20-year treasury yields rose by 1% on Monday, resuming gains after a short hiatus on Friday and approaching five-month highs at 4.696%. 

The developments come following strong US data and bullish remarks by Fed officials, which hurt the odds of multiple Federal Reserve rate cuts this year. 

Chicago Fed President Austan Goolsbey recently said the progress in reducing inflation has stalled this year, reiterating what other Fed officials said in recent  weeks, which indicated the need to maintain rates high for an extended duration.

US Rates

The odds of a Fed interest rate cut in June tumbled from 32% to 18% last week, while the odds of such a cut in July fell to 44%. 

Traders now barely expect two interest rate cuts this year, down from three cuts in previous estimates. 

Later this week, important data on US manufacturing and services PMI, in addition to GDP growth and personal spending will be released.