As stocks have stalled, bonds
rallied. Two-year Treasury yields US2YT=RR have fallen 14 basis points
in the past week or so to stand at 1.27 percent.
At the same time, German yields have risen on speculation the European Central Bank might begin the long process of rate normalization this year. The central bank issued an upbeat outlook on the Euro zone economy overnight.
The net result was a contraction in the dollar's yield advantage over the euro, which has seen the single currency steady at $1.0767 EUR= after scoring a six-week top of $1.0828 earlier this week.
The dollar did gain 0.3 percent on the yen to 111.31 JPY=, having hit a four-month low of 110.62 the day before. Against a basket of currencies, it was up 0.2 percent at 99.962 .DXY having shed 1.3 percent in the past two weeks.
"The dollar is likely to struggle as global investors gradually realize that the U.S, can still produce policy gridlock even with one party holding the White House, Senate and House," said Sean Callow, a senior currency analyst at Westpac.
In commodity markets, safe-haven spot eased a touch to $1,243.30 an ounce after hitting three-week high of $1,253.12 overnight XAU=.
Oil prices idled near four-month lows on investor concerns that OPEC-led supply cuts were not yet reducing record U.S. crude inventories.
U.S. crude CLc1 inched up 19 cents to $47.89, while Brent crude LCOc1 added 14 cents to $50.70.
At the same time, German yields have risen on speculation the European Central Bank might begin the long process of rate normalization this year. The central bank issued an upbeat outlook on the Euro zone economy overnight.
The net result was a contraction in the dollar's yield advantage over the euro, which has seen the single currency steady at $1.0767 EUR= after scoring a six-week top of $1.0828 earlier this week.
The dollar did gain 0.3 percent on the yen to 111.31 JPY=, having hit a four-month low of 110.62 the day before. Against a basket of currencies, it was up 0.2 percent at 99.962 .DXY having shed 1.3 percent in the past two weeks.
"The dollar is likely to struggle as global investors gradually realize that the U.S, can still produce policy gridlock even with one party holding the White House, Senate and House," said Sean Callow, a senior currency analyst at Westpac.
In commodity markets, safe-haven spot eased a touch to $1,243.30 an ounce after hitting three-week high of $1,253.12 overnight XAU=.
Oil prices idled near four-month lows on investor concerns that OPEC-led supply cuts were not yet reducing record U.S. crude inventories.
U.S. crude CLc1 inched up 19 cents to $47.89, while Brent crude LCOc1 added 14 cents to $50.70.
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