The US dollar held near a four-month high on Monday as rising US Treasury yields fuelled demand for the greenback and prompted hedge funds to cut bearish positions. Turkey’s shock weekend decision to replace its hawkish central bank governor also supported the dollar’s safe-haven appeal. Markets have been slow to catch on to the rising dollar theme in recent weeks as investors had bet that a global economic recovery would prompt buying of riskier currencies. But rising US Treasury yields and the prospect of more lockdowns in several euro zone countries has driven a widespread unwinding of short dollar bets. “Speculators finally capitulated to dollar strength,” said Marshall Gittler, head of investment research at BDSwiss. Though benchmark US Treasury yields declined on Monday, yields on 10-year US Treasury debt have risen for seven consecutive weeks. As a result, traders cut their long euro bets to their lowest levels since June 2020 while net positions against the Japanese yen flipped into positive territory for the first time in more than a year, latest positioning data showed.