The dollar index held onto gains made on Wednesday in early Asian trading as investors continued to unwind bearish bets. The dollar has risen in four of the past five trading sessions as the prospect of more stimulus has weighed on U.S. government bonds, sending the benchmark Treasury yield above 1% for the first time since March.
The dollar extended its rebound from near three-year lows versus major peers on Thursday, supported by higher U.S. yields, as President-elect Joe Biden prepared to outline his plans for massive fiscal stimulus.
Bitcoin also held on to 10% gains made on Wednesday as it rebounded after sliding almost $12,000 from an all-time high of $42,000 hit last week.
FX speculators have been net short the dollar since mid-March, as investors’ surging appetite for riskier assets hurt demand for the greenback.
The dollar index added 0.1% to 90.431 after gaining 0.3% overnight. It fell as low as 89.206 on Jan. 6 for the first time since March 2018.
The euro slipped 0.1% to $1.21405 after sliding 0.4% on Wednesday.
The greenback advanced 0.2% to 104.075 yen, adding to a 0.1% rise previously.
Bitcoin was little changed at $37,420 on Thursday, up from as low as $30,261.13 on Jan. 11.