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US yields boost dollar and leave yen dazed at 38-year low

SINGAPORE/LONDON, July 2 (Reuters) – The dollar was
supported by rising U.S. yields on Tuesday, with the pressure
being felt by low-yielding currencies such as China’s yuan and
Japan’s yen, which was pinned to its lowest since 1986.

Benchmark 10-year Treasury yields rose nearly 14
basis points to 4.479% overnight, with analysts linking the rise
to expectations that Donald Trump will win the U.S. presidency,
in turn leading to higher tariffs and government borrowing.

On Tuesday, the yield on the 10-year note was down 2 basis
points on the day at 4.4554%, around its highest since the start
of the month.

As the dollar rose, the euro handed back part of a
small rally as the first round of France’s election turned out
more or less in line with polling. The single currency was last
0.2% lower at $1.07188.

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