US Dollar: Supported by higher yields and data – Deutsche Bank

Deutsche Bank analysts highlight that the Dollar Index (DXY) strengthened as United States (US) yields moved higher and data remained resilient. Retail sales matched expectations, and the Atlanta Fed’s GDPNow estimate for Q2 was revised up, underscoring solid economic momentum. Short-end Treasury yields broke above 4%, while the 10-year yield reached a 10‑month high, underpinning the Dollar’s performance.

Firm US data and yields back Dollar

"And in turn, 2yr Treasury yields (+3.9bps) rose above 4% for the first time since June 2025."

"The moves were more muted further out the curve however, with the 10yr Treasury yield (+1.3bps) inching up to a 10-month high of 4.48%."

"Elsewhere, markets got further support from a robust batch of US data. In particular, retail sales showed signs of resilience, with the headline measure up +0.5% in April as expected."

"And in turn, the Atlanta Fed’s GDPNow estimate for Q2 moved up from an annualised +3.7% rate to +4.0%, suggesting the economy remained on a strong footing."

"Indeed, Brent crude oil prices are up another +1.21% overnight to $107.00/bbl. And in turn, those inflation concerns have pushed the 10yr Treasury yield up +3.5bps this morning to 4.52%, its highest level since May last year."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)