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Refunding Announcement Drives Fresh USD Strength

USD
  • USD Index extends the upleg off the July low on the back of that US refunding announcement, driven higher by the ~4bps rise in the 10y yield. The USD Index now north of key resistance at the 100- and 50-dmas at 102.366 and 102.465 respectively and the highest level since early July.
  • As noted above, the refunding announcement is in line with or higher than the highest estimates we've seen for that quarter for 2s 3s 10s and 30s.
  • Fresh greenback strength putting GBP/USD, EUR/USD at new daily lows on the move, with GBP/USD now wholly erasing the mid-July rally. This opens 1.2720 50-dma support initially ahead of 1.2674 - the Jul 06 low.

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