The dollar ticked higher on Monday as Treasury yields rose off last week’s 2-1/2-month lows following news that initial observations suggested those suffering from the Omicron COVID-19 strain only had mild symptoms.

The Omicron news from South Africa helped reverse some of the moves from Friday, when Wall Street had sold off heavily.

That selloff had taken 10-year Treasury yields below 1.4% for the first time since late-September and boosted the safe-haven yen and Swiss franc. The dollar had tumbled as much as 0.4% lower against the Japanese currency. .

Friday’s greenback losses also followed a below-forecast jobs report, though the data did little to shake market expectations the Federal Reserve will accelerate the pace of unwinding stimulus and raise interest rates starting next year.

The dollar index inched 0.10% higher at 96.29, within range of November’s 16-month peak of 96.938. It was also 0.2% higher against the yen at 113.05 yen and rebounded 0.4% to the franc.

“The dollar is capitalising on the narrative of the Fed sticking to its plans for quicker tapering, which is what we had last week from (Fed Chair Jerome) Powell,” said ING Bank FX strategist Francesco Pesole.

Dollar long positions climbed for a second straight week to the highest since June 2019, according to data from the U.S. CFTC, while bearish euro positions rose to stand at the highest since March 2020.

The euro slipped a quarter percent to the dollar.

Pesole said a further dollar long build-up was likely, given diverging policy expectations, especially against the euro.

Meanwhile, the Australian dollar was up 0.5% to $0.7035, scraping itself off a 13-month low. The kiwi rose 0.1% to $0.6750.

Riskier currencies were also supported by a slight re-steepening of the Treasury yield curve, where the gap between two and 10-year yields widened slightly after touching the narrowest in a year on Friday.

Analysts reckon the curve will flatten further, however, especially if inflation data due later in the week reinforces policy tightening expectations from the Fed.

“If you look at the shape of the yield curve, the flattening of the 2-10 segment normally brings some underperformance in commodity currencies,” Pesole said.

Elsewhere, cryptocurrencies nursed big losses from a wild weekend that at one stage crushed bitcoin more than 20%. Bitcoin found support around $49,000 on Monday.