The dollar hit a two-decade high on Monday as investors sought safety and yield amid growing concern over slowing global economic growth and rising interest rates.
The rise in inflation, the war in Ukraine and the tightening of COVID-19 lockdowns in Beijing and Shanghai have left investors in the dark, but they are confident that US interest rates are rising.
The dollar index, which measures the greenback against six major currencies, questyear was up about 9%, hitting its highest level since late 2002 on Monday at 104.090.
The Australian dollar, sensitive to 1% growth, fell to $ 0.6999, its lowest level since February. The British pound and the New Zealand dollar reached their lowest levels in 22 months, while the euro and yen were slightly above recent major falls.
The dollar’s gains were against declining equity markets, climbing 0.3% to its highest level since 2019 against the Swiss franc. It also rose 0.4% and close to a two-decade high of 131.00 yen, and tested recent highs at $ 1.0508 per euro.
“US interest rate movements aren’t the only ones supporting the dollar,” they said in a note from the strategists of NatWest Markets.
“Downside risks to global growth from Ukraine and China are more urgent for Europe and Asia than for the US, creating an atmosphere of dollar exceptionalism in style 2018 “, they added.
Chinese trade data showed that imports remained stable in April and exports increased by 3.9%. It was a little better than expected, but it didn’t help the yuan much, which fell to an 18-month low of 6.7260 per dollar as closures tightened in Shanghai.
The yield on the benchmark 10-year US government bond questyear has risen sharply by 163 basis points, which supports the dollar’s rise with it.
The US Federal Reserve raised its benchmark interest rate by 50 basis points last week, and solid employment data reinforced bets for more substantial hikes, with a focus on inflation data on Wednesday.
On the other hand, cryptocurrencies have been hit by investors in escape from asset risky, with Bitcoin taking losses at the end of the week near its year low at $ 33,500, while Ether, which is in 4% drop on Sunday, it is at $ 2,440.
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