Dollar fell in European trade on Monday against a basket of major rivals, extending losses for the seventh straight session and approaching two-month lows under pressure from extended losses by US 10-year treasury yields.
Now markets await major US inflation data for February, which will showcase the impact of inflationary pressures on the Federal Reserve’s policymakers.
The Index
The dollar index fell 0.1% to 102.64, with a session-high at 102.77, after closing down 0.1% on Friday, the sixth loss in a row, plumbing a two-month trough at 102.36 following weak US labor data.
The index lost 1.1% last week, the third weekly decline in a row, and the largest since December as US treasury yields declined following Fed Chair Jerome Powell’s Congressional testimony.
US Yields
US 10-year treasury yields declined by 0.6% on Monday, extending losses for the fifth straight session and almost breaching the five-week low of 4.038%, in turn pressuring the dollar.
The developments came as the odds of a Fed interest rate cut in June rallied recently.
US Rates
The odds of a 0.25% Fed interest rate cut in May stand at 23%, and they stand at 73% for a June rate cut.
Inflation Data
Now investors await important US inflation today for February to gauge the impact of inflationary pressures on Fed policymakers.
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