Dollar gains, euro, US bond yields drop after ECB meeting
NEW YORK (Reuters) – The euro dropped against the US dollar, while US Treasury yields slipped on Thursday in choppy trading, after the European Central Bank said it would continue its bond-buying scheme until at least September 2018 at a reduced pace.
The ECB said it would cut its bond purchases in half to €30 billion a month from January. But it hedged its bets by extending asset buys by nine months given continuously low inflation.
US Treasury yields slipped, in line with the euro-zone bond market, after the ECB decision.
“US yields are following global yields lower, fairly sharply as well,” said Gennadiy Goldberg, an interest-rates strategist at TD Securities in New York.
“The risk of the ECB being a little more hawkish has led to the rise in yields for the last week or so,” he said. “So this is a little bit of a spillover effect.”
Benchmark 10-year US Treasury notes last rose 1/32 in price to yield 2.4427%, from 2.444% late on Wednesday.
The 30-year bond last fell 3/32 in price to yield 2.9591%, from 2.955% late on Wednesday
Gold dipped as the dollar gained against the euro after the ECB decision.
Spot gold dropped 0.3% to $1,273.50 an ounce.
The dollar index rose 0.7%, with the euro down 0.95% to $1.17 after the ECB decision spurred sales of the single currency.
MSCI’s gauge of stocks across the globe gained 0.13%, with equity markets broadly mixed.
The pan-European FTSEurofirst 300 index rose 0.94%, while Japan’s Nikkei rose 0.15%.
On Wall Street, the Dow Jones Industrial Average rose on gains across sectors, but losses in Celgene held back the two other major indexes in one of the busiest days of third-quarter earnings.
In late-morning trading the Dow rose 117.47 points, or 0.5%, to 23,446.93, the S&P 500 gained 8.23 points, or 0.32%, to 2,565.38, and the Nasdaq Composite added 14.86 points, or 0.23%, to 6,578.76.
Celgene shares dropped 16.0% after the biopharmaceutical company reported disappointing sales for its psoriasis drug Otezla.
Oil slipped, pressured by an unexpected increase in US crude inventories, high US production and exports. But it stayed near multi-month highs on support from tighter crude markets.
US crude fell 0.02% to $52.17 per barrel, and Brent was last at $58.31, down 0.22% on the day.