Banking Top

The dollar was up on Monday morning in Asia, hovering near record gains against the euro and yen. Investors turned to the dollar thanks to the previous week’s U.S. economic data and the quickening pace of the U.S. COVID-19 vaccine program.

The U.S. Dollar Index that tracks the greenback against a basket of other currencies inched up 0.10% to 92.812 by 9:54 PM ET (1:54 AM GMT).

The USD/JPY pair inched up 0.01% to 109.66. The yen was not far from strong resistance and Friday's 10-month low of 109.85 against the dollar, as it is sensitive to gaps in returns on U.S. and Japanese government debt.

The U.S. economic recovery has seen a 76-basis-point rise in 10-year Treasury yields in 2021, the biggest since February 2020. The rise drew in Japanese investors, in turn pushing the yen down near 6% in the quarter to date.

On Wednesday, U.S. Treasury Secretary Janet Yellen and Federal Reserve Chair Jerome Powell expressed their confidence in the U.S. recovery during a second day of testimony to Congress.

Yellen told Senate lawmakers she was open to banks buying back stock and paying dividends, an updated view showing her confidence in the economy. Powell also said he thinks 2021 will be a "very, very strong year in the most likely case."

A day earlier, though, the treasury secretary had put investors on alert after espousing tax hikes to pay for President Joe Biden's plans for upgrading infrastructure and other investments.

Despite slight market aversion to risk-correlated currencies, the Euro Australian Dollar (EUR/AUD) exchange rate’s gains remain limited. Investors are hesitant to buy the Euro much amid concerns that the Eurozone is in for more coronavirus restrictions.

Last week saw EUR/AUD trend with a largely downside bias after opening the week at the level of 1.5404. However, the pair ended the week a little higher in the region of 1.5450.

This week’s movement has been mixed as well. Last night, EUR/AUD touched on a fortnight high of 1.5276 before slipping a little lower and trending around the week’s opening levels again today.