Asia stocks snap winning streak, await RBA

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Deja Bù: Mark reconnects with Jessica Harnois, founder Bù Wines | SaltWireSINGAPORE - Asian stocks snapped a three-day winning streak on Tuesday, slipping as the bond market's rally paused and investors reined in enthusiasm about a possible peak in global interest rates.

Overnight the dollar had rallied with a rise in U.S. Treasury yields, leaving the Australian dollar under gentle pressure at $0.6495 in morning trade in Asia. Aussie government bond futures fell slightly and the ASX200, which had gained five sessions in a row, slipped 0.4%. Two-year U.S. Treasury yields rose nearly 11 basis points overnight, though that only partially unwound an 18 bp fall in the previous week. Ten year yields rose 10 bps on Monday, but had fallen almost 30 bps last week.

The euro took a breather at $1.0710 and analysts expect any prospective decline in the greenback to be bumpy and modest, even if the Fed starts cutting rates next year."Outside of monetary policy, it is weak global growth and abundant geopolitical risks ranging from Taiwan to the Middle East and Russia that we see as providing continued safe-haven support to the dollar, slowing a dollar down cycle," said Deutsche Bank strategists Alan Ruskin and George Saravelos.

 

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