Dollar Index struggles as yields sag despite strong data

The dollar index [dxy] is struggling to extend the rebound from the low of 93.26 as the yields remain weak despite strong US data.

At press time, the DXY is trading flat lined around 93.50 levels.  The greenback rebounded from the support offered by the trend line sloping downwards from the high of April 10 and  May 11 high after data showed US service sector growth hit is fastest in 12 years in September.

The ISM non-manufacturing registered 59.8 in September, beating estimates of 55.5 from economists polled by Reuters. The USD also received a boost from the ADP report, which showed the private sector in the US added more jobs in September despite hurricane Harvey and Irma.

Despite the strong data, the 10-year treasury yield ended on a flat note at 2.30%. The yield was last seen trading around 2.33% and stays well below Monday's high of 2.371%.

Looking ahead - the focus remains on the Treasury yields today. Friday's non-farm payrolls and wage growth numbers couuld yield big mvoes in the yields and the US dollar.