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The US dollar climbed against its most major counterparts in the New York session on Friday, as US treasury yields rose amid growing expectations that the Federal Reserve will tighten monetary policy aggressively to curb high inflation.
The benchmark yield on the 10-year treasury note spiked up to 2.462 percent. Yields move inversely to bond prices. Chicago Fed President Charles Evans said on Thursday that he supported a a quarter-point rate hike at the remaining meetings through next March, but is “open-minded” about a possible 50-basis-point move.
Economic Data
Baker Hughes on Friday reported that the number of active US rigs drilling for oil was up by seven to 531 this week. That followed a decline of three oil rigs the week before, Baker Hughes data show.
The total active US rig count, which includes those drilling for natural gas, also climbed by seven at 670, according to Baker Hughes.
Other Developments
Investors are pricing in half-point rate hikes in both May and June following hawkish comments from Fed Chair Jerome Powell earlier this week.
Oil prices continued to edge higher in Friday dealings, as reports of an attack on a Saudi oil facility fed supply concerns. May West Texas Intermediate crude was up $1.14, or 1%, at $113.48 a barrel on the New York Mercantile Exchange.
Bank of America’s commodities team has forecast 900K bbl/day of lower-48 supply additions on 100 horizontal rig additions throughout 2022; the oil rig count is now up 41 in the first 11 weeks of this year.
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