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A passerby walks past an electric monitor displaying various countries' stock price index outside a bank in Tokyo, Japan, March 22, 2023. REUTERS/Issei Kato/File Photo - 

VOInews, London : The U.S. dollar and bond yields held near multi-month peaks on Monday on expectations the Federal Reserve would slow its pace of easing, while global shares were mostly lower, with investors waiting for Nvidia's earnings release later in the week.

U.S. President-elect Donald Trump's new administration is beginning to take shape with nominations to health and defense roles last week, but two key positions for financial markets, Treasury Secretary and Trade Representative, are yet to be filled.

Trump's pick of vaccine sceptic Robert F. Kennedy Jr. for the top U.S. health job has already led to a fallout in the health care sector, with drugmakers sliding at the end of last week.

"It should be a quieter week as the recent relentless wave of U.S. macro and political news flow in theory slows down with the main story on this front being on potential political appointments for the new Trump administration," said Deutsche Bank head of global economics and thematic research Jim Reid.

Trump's plans for lower taxes and higher tariffs are expected to spur inflation and reduce the Fed's scope to ease interest rates.

U.S. Treasury yields held near multi-month highs on Monday, having been bolstered by bets of less aggressive Fed rate cuts down the line.

The benchmark 10-year yield steadied at 4.4256 per cent, while the two-year yield last stood at 4.2823 per cent.

Futures imply a 60 per cent chance of the Fed easing by a quarter-point in December and have only 75 basis points of cuts priced in by the end of 2025, compared with more than 100 a few weeks ago.

That has come on the back of Fed Chair Jerome Powell's comments last week signalling that borrowing costs could remain higher for longer.

"With changes afoot in immigration policy, tariff policy, and fiscal policy, Fed officials would tread more lightly anyway in view of the inflationary impact that these policies pose," said Thierry Wizman, global FX and rates strategist at Macquarie.

The shift in outlook for U.S. rates and inflation lifted the dollar to a one-year high last week.

The dollar index, which measures the currency against a basket of six others, was steady at 106.69, just below last week's peak of 107.07.

Sterling last bought $1.2618, languishing near last week's six-month low, while the euro stood at $1.0547.

Global equity markets were slightly lower as investors took stock of latest developments with Trump's top team and the outlook for monetary policy.

However, he later said in a press conference that keeping inflation-adjusted real interest rates low for too long could cause excessive inflation and force the BOJ into hiking interest rates rapidly//CNA-VOI