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Dollar Fluctuates as Optimism Over China's Reopening Fades

The dollar experienced some fluctuations on Thursday as investors became increasingly cautious about the global economic outlook.

$100 Bills
$100 Bills

This followed China's announcement to lift its quarantine rule for inbound travelers on January 8th. However, countries like the United States, Japan, and India have all stated that they will require COVID tests for travelers coming from China. This has led to concerns about the potential spread of the virus and its impact on global recovery.

Yen and Sterling Struggle as Uncertainty Persists

The Japanese yen was up 0.6% at 133.71 per dollar, hovering near a one-week low of 134.50 that was reached in the previous session. Similarly, the sterling rose 0.1% to $1.2030 but was still not far from its three-week trough of $1.1993 that was hit last week. The euro, on the other hand, was up 0.12% at $1.0623.

Yen Notes
Yen Notes

U.S. Treasury Yields and Dollar Index Show Mixed Results

The yield on the two-year U.S. Treasury, which is often used as an indicator of interest rate expectations, slipped overnight. It was last recorded at 4.3678%. In contrast, the benchmark U.S. 10-year Treasury yield rose to a more than one-month high of 3.8920% overnight before falling to 3.8637%. The U.S. dollar index, which measures the dollar's value against a basket of currencies, remained firm at 104.33.

Bitcoin and Ether See Mixed Results

In the world of cryptocurrencies, Bitcoin edged 0.12% higher to $16,560, while Ether gained 0.3% to $1,193.40. However, both are still on track for a decline of over 60% this year.