Dollar, Yields Divergence Could Reflect Shifting Fed Outlook

Dow Jones06-24 22:51

1051 ET - The dollar strengthens while Treasury yields decline as markets react to Fed policy and easing geopolitical tensions. The Fed sounded surprisingly hawkish last week, fueling expectations of at least one and maybe two interest rate increases this year which would support the greenback. "The dollar's spot price could continue to react to the near-term risk of rate hikes," Naga.com's Frank Walbaum says. Meanwhile, falling oil prices reduce inflation fears, weighing on yields. The Fed's pledge to keep fighting inflation reassures markets that rates will fall after a potential tightening, Walbaum says. The WSJ Dollar Index rises 0.3%. The 10-year Treasury yield is at 4.416%, after reaching 4.5% overnight. (paulo.trevisani@wsj.com; @ptrevisani)

(END) Dow Jones Newswires

June 24, 2026 10:51 ET (14:51 GMT)

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