USD Gains as 30-Year Treasury Yields Hit 4.889% in Strong Auction

The US dollar index advanced 0.22% as Treasury yields climbed following a robust 30-year bond auction at 4.889% yield. The $22 billion auction saw strong demand with a negative tail of 0.1 basis points, better than the 6-month average of -0.3 basis points. Direct bidders took 27.4% (vs 23.1% average), while indirect bidders absorbed 59.78% (vs 63.0% average), suggesting solid but slightly reduced foreign demand. The auction grade of B indicates above-average performance, supporting dollar strength across major pairs. Higher yields are reinforcing the greenback's appeal as traders reassess Fed rate cut expectations for 2025. Technical resistance for the dollar index stands at 106.50, with support at 105.80. The yield dynamics suggest continued dollar support in the near term, particularly against low-yielding currencies like the JPY and CHF.