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Dollar tests resistance as oil, yields lift the greenback
The euro faces pressure tied to France's budget crisis, while rising Treasury yields keep Fed tightening expectations elevated.
Action Forex said the US dollar opened the week at 18-month highs, trading near the top of last week's range as the DXY regained its upward momentum after early intraday pressure.
The outlet linked the dollar's strength to oil prices, saying the index is closely correlated with crude as elevated Middle East tensions and expectations of limited impact from a Russia diesel supply deal support Brent.
Action Forex added that rising Treasury bond yields are boosting the greenback further, alongside growing odds that the Fed continues monetary tightening, and it cited Wall Street Journal expectations for yields to ease to 4.78% by the end of next year from 5.3% at the end of last week.
The piece also pointed to differences in economic resilience, saying the US can withstand higher interest rates more than Europe, with France's budget crisis and election uncertainty weighing on the euro.
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