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FOREX-Higher Treasury yields boost dollar
Published at 18/10/2018 at 14:42

* Higher Treasury yields boost dollar

* U.S. refrains from calling China a currency manipulator

(New throughout, updates prices, market activity and comments to U.S. market open, new byline, changes dateline, previous LONDON)

By Karen Brettell

NEW YORK, Oct 18 (Reuters) - The U.S. dollar index traded near one-week highs on Thursday as Treasury yields edged higher, after minutes from the Federal Reserve’s September meeting showed that Fed policy makers are largely united on the need to raise borrowing costs further.

That came despite U.S. President Donald Trump's view that interest rate hikes have already gone too far.

Benchmark 10-year Treasury yields have jumped to 3.21 percent , from around 3.17 percent before the minutes of the U.S. central bank's Federal Open Market Committee (FOMC) meeting were released on Wednesday, supporting a higher dollar.

“The Treasury market leaked higher in yield yesterday following the FOMC minutes, and that got a bit of attention,” said Brian Daingerfield, a macro strategist at NatWest Markets in Stamford, Connecticut.

"For the broader dollar, the interplay is how does the dollar trade relative to what’s going on interest rates and what’s going on in the broader risk environment?” Daingerfield said.

The dollar index measuring the greenback against a basket of currencies gained 0.14 percent on the day to 95.711, just below a one-week high of 95.775 reached in overnight trading.

China's currency traded near a three-month low against the dollar at 6.9490 yuan per dollar, after a semiannual report by the U.S. Treasury refrained from naming China a currency manipulator but showed concern about yuan depreciation.

"Of particular concern are China's lack of currency transparency and the recent weakness in its currency," said Treasury Secretary Steven Mnuchin.

By stating that the Treasury will monitor and review the yuan's moves over the coming six months, “the U.S. explicitly noted that it stands ready to name China in its April 2019 report,” Citigroup analyst Calvin Tse said in a report.

Deutsche Bank strategists termed the Treasury report "as a bit of an escalation without being too dramatic."

========================================================

Currency bid prices at 9:32AM (1332 GMT)

Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid

Previous Change

Session

Euro/Dollar EUR= $1.1494 $1.1499 -0.04% -4.18% +1.1527 +1.1482

Dollar/Yen JPY= 112.5300 112.6400 -0.10% -0.12% +112.7200 +112.4400

Euro/Yen EURJPY= 129.36 129.53 -0.13% -4.31% +129.7200 +129.1300

Dollar/Swiss CHF= 0.9959 0.9952 +0.07% +2.22% +0.9975 +0.9921

Sterling/Dollar GBP= 1.3100 1.3113 -0.10% -3.05% +1.3131 +1.3077

Dollar/Canadian CAD= 1.3040 1.3016 +0.18% +3.68% +1.3055 +1.3019

Australian/Doll AUD= 0.7128 0.7108 +0.28% -8.63% +0.7151 +0.7105

ar

Euro/Swiss EURCHF= 1.1449 1.1444 +0.04% -2.05% +1.1466 +1.1428

Euro/Sterling EURGBP= 0.8772 0.8768 +0.05% -1.24% +0.8792 +0.8769

NZ NZD= 0.6559 0.6548 +0.17% -7.44% +0.6577 +0.6535

Dollar/Dollar

Dollar/Norway NOK= 8.2250 8.2122 +0.16% +0.22% +8.2341 +8.2053

Euro/Norway EURNOK= 9.4569 9.4467 +0.11% -3.98% +9.4669 +9.4405

Dollar/Sweden SEK= 8.9950 8.9639 +0.31% +9.67% +8.9994 +8.9513

Euro/Sweden EURSEK= 10.3400 10.3077 +0.31% +5.10% +10.3432 +10.3054

(Additional reporting by Saikat Chatterjee in London; editing by Jonathan Oatis)

((Karen.Brettell@thomsonreuters.com; +1 646 223 6274; Reuters Messaging: karen.brettell.reuters.com@reuters.net))