The US 10-Year Treasury yield has been growing since August 4, 2020,
when Russia announced a locally developed Covid-19 vaccine. The news
bailed the yield out of its bottom at 0.51%. As of writing time, it has
reached as high as 1.12. The positive dynamic may boil down to the shift
in investment. Traders in financial markets switch to stocks amid the
rising risk appetite, which sends record highs to US stocks at the
expense of bond prices. Since the yield is set to gain more in 2021,
chances are it easily straddle the resistance at 1.25% and then
challenge the higher 1.5%. With that said, the buoyant yield will play a
role in both the metal market and the forex market.To get more news
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In
the forex market, the US dollar will reverse the decline amid the
soaring yield. As financial markets have adopted an upbeat outlook on
the US economy, expectations follow are that the Fed would raise
interest rates early, which bodes well for the dollar. The aggressive
yield, however, will hamper the haven-linked Japanese yen. The potential
resistance for USD/JPY will lie at 104.76 or even 105.68.
In the
precious metal market, prices of gold and silver plunged as shocked by
the growing yield. Gold prices have been retreating from the fresh high
of 2,075 since August 4, 2020, the same day the yield started to
rebound. It suggests the bond market and the metal market reversed at
the same in the wake of Russias claim. Gold and silver will suffer from
double pressures in this case. By this account, the spot gold is likely
to test $1,764, while the spot silver could test the $22 barrier.
The Wall