PRESS ROOM
Dollar steady while Treasury yields rise
Friday 14th January '22
The US dollar was facing headwinds from the US twin deficit (a combination of the current account and budget deficits) before the pandemic. The pandemic revived the dollar’s fortunes with haven demand for the currency rising during turbulent market and economic conditions. At the start of January 2022, however, the US dollar has not matched the sharp increase in US Treasury yields. It is possible that as the dollar’s haven demand dissipates, the pressures on the currency from the twin deficit become more apparent again. The price movements in January so far might be a harbinger of this.