After yesterday’s rally, the U.S. dollar struggled to extend its gains. The greenback sold off against all of the major currencies with the exception of the British pound. With existing home sales rising strongly, the problem were that yields spent most of the day in negative territory. The yield curve also moved to its flattest level since 2007, reflecting the market’s doubt on whether inflation will rise. However by the end of the North American session, 10 year Treasury yields bounced off their lows. There was still a lot of back and forth in U.S. rates so USD/JPY failed to recapture yesterday’s high near 112.72. ... (full story)