Dollar Set for Best Week in Years

First, despite the poor reception to the U.S. Treasury 30-year bond auction yesterday, the increased size of MBIA's(MBI Quote - Cramer on MBI - Stock Picks) share offering in the face of strong demand may be more significant. The yield on the 30-year bond was reportedly the lowest on since the bond was regularly issued back in the late 1970s. Moreover central banks continue to pour money into US Treasuries. Even if it is not picked up in the TIC data, which only covers activity through the U.S. banking system, those banks that use the Fed's custody services bought another $10.6 billion worth in the latest reporting period, bring the total amount to near $60 billion in the past four weeks.

Second, Emerging Portfolio Fund Research reports that $7 billion was withdrawn last month in US-based equity funds that invest internationally, and diversified U.S. equity funds reportedly saw $19 billion of withdrawals last month. Of note, funds, including ETFs, that concentrate in financial services companies took in $2.8 billion, which represents about a 20% increase.

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