The U.S. dollar eased back from earlier highs on Thursday, as 10-year Treasury yields continued to climb.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, fell 0.37% to 95.32 as of 11:08 AM ET (15:08 GMT).
The yield on the benchmark 10-year Treasury note rose to levels not seen since 2011 after upbeat economic data and hawkish comments from Fed Chairman Jerome Powell bolstered expectations of an interest rate increase in December.
The yield was up 1.36% to 3.204% after jumping almost 4% in the previous session.
Fed Chairman Jerome Powell said Wednesday that the U.S. central bank may raise interest rates above an estimated “neutral” setting as the U.S. economy continues to grow.
“Interest rates are still accommodative, but we’re gradually moving to a place where they’ll be neutral,” neither holding back nor spurring economic growth, Powell said.
“We may go past neutral. But we’re a long way from neutral at this point, probably,” he added.
Data this week showed that private sector hiring increased at the fastest pace in seven months in September while weekly jobless claims numbers fell to an almost 49-year low.
Elsewhere the euro recovered due to the weaker dollar while sterling surged amid reports that the European Union and the UK are in the final Brexit negotiation stages.
EUR/USD increased 0.39% to 1.1522 and GBP/USD rose 0.70% to 1.3030.
The dollar slid lower against the yen, with USD/JPY down 0.69% to 113.74.
The Australian dollar was lower, with AUD/USD down 0.20% to 0.7090, while NZD/USD fell 0.21% to 0.6499 and USD/CAD rose 0.01% to 1.2870.
