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Th US Dollar has regathered its strength and rallied amid risk aversion. The dollar Index reached its highest level in over two months above 104.50 on Wednesday.
The dollar’s performance is likely to continue to be impacted by risk perception in the second half of the day with investors keeping a close eye on headlines surrounding the debt-limit bill.
On Tuesday, the House Rules Committee advanced the debt-ceiling bill to the House by an uncomfortably close vote of 7 to 6, causing investors to adopt a cautious stance. Several Republican lawmakers voiced their oppositions against the bill, which will be debated in the House floor and voted on Wednesday before moving to a final Senate vote.
Reflecting the risk-averse market atmosphere, Wall Street’s main indexes opened deep in negative territory on Wednesday.
The US Bureau of Labour Statistics reported on Wednesday that the number of job openings on the last business day of April stood at 10.1 million, compared to 9.74 million in March. This reading came in higher than the market expectation of 9.37 million and helped the USD extend its daily rally.
Fed’s Loretta Mester said that she doesn’t necessarily see a compelling reason for pausing rate increases amid a “really embedded, stubborn inflationary pressure.” Benchmark 10-year US Treasury bond yield continues to push lower on Wednesday and was last seen losing more than 1% on a daily basis below 3.7%.
