Reuters: Possible Fed move to cap yield rise could further weaken U.S. dollar

Whilst not take any steps to cap rising bond yields, Fed Chairman Jerome Powell said that the central bank would still consider yield curve controls once the U.S. economy’s direction becomes clearer. This in turn would likely intensify the downward pressure on the U.S. dollar that has partially resulted from a gradual reopening of global economies, as investors look to alternatives to U.S. Treasury debt. John Floyd, Head of Macro Strategies at Record Currency Management, has commented that investors are selling the dollar due to their belief that the Fed’s actions in yield curve control will be aggressive.

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