Foreign exchange traders monitor screens in Tokyo, Japan. Picture: GETTY IMAGES/CARL COURT
“What’s driving the market is corporate earnings are posting a strong recovery,” said Jumpei Tanaka, strategist at Pictet. Longer-term US Treasury yields rose in anticipation of a large pandemic relief bill from Washington as well as on heightening inflation expectations. A market gauge of future US inflation was at its highest since October 2018 while that for the eurozone hit its highest since May 2019.
The US dollar index stood near a two-month high, having risen 1.1% so far this week, on course for its biggest weekly increase since October. “The fact that the only currencies that are doing better than the dollar over the past two days are the British pound and the Israeli shekel, the two countries that are going further ahead in vaccination, seems to support that.”