Stocks were battered yesterday while Treasury yields climbed, as the dollar continues its ascend with EUR/USD breaking below parity to its lowest levels since 2002. The fact that China continues to advocate for a weaker yuan, seeing USD/CNY surge higher is also providing an added tailwind for the greenback this week.
For some context, USD/CNY has now broken higher to 6.85 upon the PBOC setting a weaker yuan after the break above 6.80 at the end of last week. The next key target will be the 7.00 mark and that sort of gives you an idea of how much more backing the dollar has from said tailwind at the moment.