Rising US Yields Keep the Dollar in Front—But Not Unchallenged

EUR/USD slipped to around 1.1325 as rising US Treasury yields and a dovish tilt from European Central Bank President Christine Lagarde supported the dollar. The euro’s weakness gives the greenback a clear edge, though the advantage is being built on relative rate expectations—not an all-clear on the US economy. The next test is whether incoming US data keeps that yield support intact.

The Bear Case

The dollar’s win over the yen has a catch: the Bank of Japan’s meeting...