Traders Bent on Bludgeoning Dollar Ignore Bond Market Signals
- Treasury-Bund yield gap widens to most in two decades
- Change in long-standing convention puts fundamentals at fore
Oanda's Innes Says Lack of Inflation Weighs on Dollar
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Even higher yields aren’t rushing to the aid of the currency market’s favorite whipping boy.
The dollar is ending the year down about 12 percent against the euro, even after three interest-rate increases by the Federal Reserve took the spread between two-year U.S. and German note yields to near its widest in nearly two decades. Traders who have long taken their cue from interest rates are focusing instead on a macro outlook that shows Europe’s economy revving into high gear as the U.S. cycle begins to age.