Dollar reverses gains

LONDON: The dollar reversed earlier gains on Tuesday and turned lower as U.S. Treasury yields pulled back from their recent move higher while the euro strengthened after economic data confirmed the euro zone economy is growing at a healthy clip.

The greenback is set for its biggest monthly decline since July 2017 against the euro, as the combination of strong global growth - notably in Europe - and slow inflation encouraged investors to add bearish bets.

But a spike in global bond yields, with 10-year U.S. bond yields pushing well above 2.70 percent, its highest since April 2014, prompted some investors to cut some short positions and pushed the dollar higher on Monday.

But with global risk sentiment nervous with equity markets broadly in the red, the spike in bond yields proved to be short lived. The dollar was down 0.2 percent against a basket of six major currencies at 89.161 , having pulled up from a low of around 88.43 set last week, its weakest level since December 2014.Analysts said a renewed rise in U.S. bond yields this week still lent some support to the dollar.

The U.S. 10-year Treasury yield reached a peak of 2.733 percent in Asian trading on Tuesday, the highest since April 2014, before slipping back.