XE Market Analysis: Asia – Jan 07, 2021

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The Dollar rallied for the second day on Thursday, though the bulk of gains came ahead of the N.Y. open. Higher Treasury yields, and prospects for stronger U.S. growth in the coming months due to what will likely be ramped up spending by Democrats now that they are in charge, have driven the USD up since Wednesday. The DXY printed six-session highs of 89.97 in morning trade, up from early Asian lows of 89.35. Treasuries appear to be raising the red flag on the inflation outlook, while continuation of massive deficit funded stimulus at some point will have the opposite impact on the Dollar.