The U.S. dollar, measured by the DXY index, climbed on Tuesday, marking its fourth consecutive trading session of gains and reaching its best levels since July 10 (DXY: +0.52% to 102.40). This advance was driven primarily by rising U.S. Treasury yields, with the 10-year note topping 4.0% and approaching the peak observed last month.
Encouraging U.S. economic data recently, including second-quarter GDP and consistently low unemployment claims, have boosted bets that the country will avoid a recession altogether in 2023 and possibly in 2024. This could mean further policy firming and higher rates for longer, especially if demand pressures prevent inflation from quickly converging to the 2.0% target.
