USD rose against other major currencies in the European session on Monday, as the U.S. Treasury yields increased on inflation concerns.
The U.S. Dollar Index (DXY), measuring the U.S. currency's value relative to a basket of foreign currencies, increased 0.14% to 94.07.
The 10-year Treasury yields were trading at 1.602% in the morning compared to 1.575% at Friday’s close on heightened expectations that growing inflation pressures would prompt a quicker-than-expected withdrawal of the Federal Reserve’s monetary stimulus.
Meanwhile, the overall risk sentiment was dented by mostly disappointing economic data out of China. The country’s Q3 GDP missed economists’ expectations with a growth of only 4.9% y/y compared to the forecast of +5.2% y/y. In addition, Chinese data on industrial production for September also disappointed market participants, posting a 3.1% y/y gain, while economists were looking for a 4.5% y/y advance. Meanwhile, China’s retail sales exceeded forecasts, rising 4.4% y/y in September compared to economists’ estimate of +3.3% y/y.