Greenback stabilizes following yesterday’s sharp decline

US Dollar Holds Steady After Recent Decline

Following a steep drop yesterday, the US dollar is now stabilizing and showing slight strength against most major currencies, with the Japanese yen standing out as an exception. The yen has continued to build on its unexpected post-election rally, gaining momentum both during the Asian trading hours and into the European morning.

Meanwhile, the long end of Japan’s yield curve has also seen a surprising surge, as yields on 30- and 40-year government bonds have fallen for the fifth or sixth session in a row. Although the dollar initially responded sharply to China’s comments regarding its holdings of US Treasuries, the broader bond market has shown little reaction. Notably, the yield on the US 10-year Treasury has slipped below 4.20%, a level that previously acted as resistance.