The Impact of Rising Treasury Yields on Global Markets

The US dollar strengthened to a near 1-week high against a basket of currencies as risk sentiment soured due to lackluster corporate results and rising US Treasury yields. Tech giant Alphabet's cloud division missing revenue estimates and the surge in US bond yields contributed to the decline in risk appetite. Meanwhile, benchmark US 10-year Treasury yields inched higher, nearing a 16-year peak. Analysts, however, see limited room for yields and the dollar to extend gains. The Australian dollar initially jumped on higher inflation readings but later erased gains, while the Canadian dollar weakened after the Bank of Canada forecasted weak growth and left the door open for more rate hikes. The Japanese yen remained near the 150 threshold, with pressure mounting on the Bank of Japan to change its bond yield control. Bitcoin also rose, fueled by speculation of an imminent exchange-traded bitcoin fund.