The U.S. dollar retreated from a six-week high on Wednesday on rising hopes that the U.S. is nearing a deal with Iran to end the war in the Middle East, Reuters reported.
U.S. President Donald Trump said negotiations with Iran were in the final stages, while warning of further attacks unless Iran agrees to a deal. That sent Treasury yields sharply lower and dented the dollar, a safe-haven investment that is correlated with yield moves.
The greenback had also been approaching technical levels that suggested some giveback was due, said Marc Chandler, chief market strategist at Bannockburn Global Forex.
This includes seven consecutive down days for the yen against the U.S. currency, the longest stretch since October.
Concerns are growing that inflation linked to the war may become more entrenched in core consumer spending, driving expectations of higher interest rates and a more hawkish stance from central banks.
Benchmark 10-year U.S. Treasury yields reached a 16-month high on Tuesday, while 30-year yields hit their highest level since 2007.
Follow the latest news on Google News
