By Yasin Ebrahim
Investing.com – The dollar jumped against its rivals on Monday, led by a rise in U.S. Treasury yields as sentiment on risk turned positive amid efforts by governments to reopen their economies. Gains against the pound also lifted the greenback.
The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, rose by 0.49% to 100.22, from a low of 96.67.
The reopening of the economies globally helped spark risk appetite, with investors seemingly betting than the global growth has likely bottomed, sending Treasury yields higher, boosting the greenback.
The U.S. 10-year benchmark rate rose 5.4% to 0.718%, though the upside will likely be limited amid expectations that the Federal Reserve could be forced to cut rates below zero,
The ongoing expectations for negative rates come just days ahead of Federal Reserve Chairman Jerome Powell's virtual conference to deliver an economic update Wednesday at 9:00 AM ET (13:00 GMT).
"We might hear Powell further broach the outlook for inflation risk., Powell may also use the opportunity to address prospects for further policy instruments such as negative rates," Scotiabank said.
The dollar's advance was also helped by gains against the pound as the Prime Minister Boris Johnson's move to ease lockdown restrictions had muted impact.
GBP/USD fell 0.62% to $1.2330.
The bright start to the week for the dollar could continue amid signs that traders are ramping up their bullish bets on the greenback.
Net long positions in the dollar increased for the seventh week in a row, according to the CFTC positioning report.