The Dollar Rises As More and More Central Banks Become Dovish and Defy Lower Treasury Returns By Reuters

By Shinichi Saoshiro

TOKYO (Reuters) – The dollar rose on Thursday, as many of its peers weakened after more and more central banks chose to adopt an accommodative policy in the face of the deteriorating economic outlook.

The Reserve Bank of New Zealand (RBNZ) has recently given way to lower prices, adding to the list of central banks that have become dovish.

The balance against a basket of six major currencies was up 0.17% to 96.942 and was heading towards its third day of gains.

With many of his peers on the defensive, the dollar was able to offset a decline in benchmark US Treasury yields to lower levels in 15 months.

"Treasury yields are actually lower, but that does not have much impact on the dollar, as Treasury yields remain at attractive levels relative to the Eurozone and the New World. Zealand, which has just become dovish, "said Takuya Kanda, general manager at the Gaitame.Com Research Institute.

"So these are currencies like the euro, which are suffering the negative contractions of Germany, and the New Zealand dollar, which are suffering losses and allow the dollar to rise in turn."

The euro was a little higher at $ 1.1252. The single currency lost another 0.45% this week as the benchmark 10-year Bund fell to its lowest level in two and a half years, down 0.09%.

The rise in the euro was limited after European Central Bank President Mario Draghi said that a rise in interest rates could be further delayed.

Growth-sensitive currencies have recently taken steps to counter increasing risks to the global economy, as evidenced by the collapse in US bond yields that signaled a future recession.

The New Zealand dollar was down 0.2% to 0.6786 USD, which reduced the loss from the 1.6% drop the day before.

The Australian dollar, which often moves in the same direction, slipped 0.1% to 0.7077 dollar. The Reserve Bank of Australia had abandoned its tightening bias for a long time last month and the markets fell this year.

The kiwi lost nearly 0.7% Wednesday.

The pound lost 0.1% to 1.3172 USD after reaching 1.3143 USD earlier Thursday.

Sterling was back after an offer by British Prime Minister Theresa May to resign to have her divorce agreement signed by the European Union by parliament fails to win the main opponents of the 39; agreement. [GBP/]

The dollar slid 0.15% to 110.34 yen but managed to avoid a six-week low of 109.70 Monday.

The decline fell to 2.342%, its lowest level since December 2017 due to concerns over a global recession and after the RBNZ adopted a dovish tone on interest rates. [US/]

History begins again to include the rise of the dollar as more and more central banks get closer, defies low Treasury yields