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The US dollar advanced on Friday as investors tackled a reverse US Treasury yield curve and a further disappointing economic data series in the euro area that put pressure on the euro.
ICE US Dollar Index
DXY, + 0.64%
continued its climb after Thursday's gains and rose 0.1% to 96.616. For the week, the gauge, which measures the greenback compared to six competitors, is flat. It reached a minimum of six weeks on Wednesday, following the update of the dovish policy of the Federal Reserve.
Do not miss: Turkish lira plummets against renewed fears of massive sell-off in emerging markets
Elsewhere in US assets, the gap between the 3-month Treasury yield
TMUBMUSD03M, + 0.00%
and the 10-year return
TMUBMUSD10Y, + 0.00%
reversed for the first time since 2007, thanks to a longer-term takeover of bonds. US stocks fell, with the reversal of the yield curve seen as an early indicator of recession.
Check-out: The yield curve is reversed – here are 5 things investors need to know
This was not the only big change in fixed-income securities, as disappointing data drove German 10-year bond yields
TMBMKDE-10Y, + 0.00%
fall below 0% sooner.
L & # 39; euro
EURUSD -0.6329%
was among the worst performers against the dollar on Friday, the last time he had bought $ 13,300, down $ 1.1337, its lowest level in six days.
The preliminary index of purchasing managers in the manufacturing sector in the euro area fell to 51.3 in March, from 51.9 in February, a more pronounced decline than expected. The manufacturing PMI slipped to 47.6, against 49.5 expected. A level below 50 denotes an economic contraction. The data highlighted the slowdown in the European economy, which the European Central Bank warned in its latest update.
In Germany, the largest economy in the euro area, the manufacturing PMI for March slipped to 44.7, less than expected, and less than 47.6 previously. The PMI services index for the same period came in at 54.9, slightly exceeding expectations. A reading below 50 indicates a contraction in activity.
In this context, the Japanese yen
USDJPY, -0.81%
– a traditional refuge – strengthened against the dollar and the euro
EURJPY, -1.43%
The dollar was down 0.7% to ¥ 110.06 while the euro fell 1.3% to ¥ 124.36, its lowest level since early February and late January, respectively.
In the United Kingdom, the pound sterling
GBPUSD, + 0.7706%
was modestly stronger at $ 1.3209 compared to $ 1.3107 on Thursday night.
The European Union on Thursday agreed to a conditional extension of the Brexit deadline of 29 March. If the UK Parliament adopts a version of Prime Minister Theresa May's agreement next week, the exit point will be postponed until May 22. If the vote fails – as it has already done three times before – the UK must clarify its next steps or leave without an agreement by 12 April.
Brexit Brief: Europe throws Theresa May and UK, a lifesaver
The dollar was also stronger in emerging markets, with the Turkish lira
USDTRY, + 5.4377%
the worst performer. Turkish investors have been grappling with Ankara's economic problems since last summer, when a large-scale liquidity wave swept through emerging markets. A dollar last bought 5.8164, up 6.4%.
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