Dollar Rises Six Weeks as Trade and Growth Concern Increase

SINGAPORE (Reuters) – The dollar is appreciated against most other currencies on Monday, standing near a six-week high as new concerns over US-China trade tensions and global growth have boosted appetite for safe haven badets.

"Discussions between China and the United States are at the center of the week's concerns and the strong dollar reflects the current cautious market environment due to its safe haven status," said Nick Twidale. Director of Operations at Rakuten Securities.

"The Australian dollar and the euro are at vulnerable levels right now and an additional tightening of risk sentiment can lead to a further decline in these currencies."

US negotiators are going to press China this week to ask it to reform its intellectual property treatment of US companies to seal a trade deal that could prevent higher tariffs on imports from China .

The dollar gained 0.1% against the yen at 109.82. However, traders expect dollar / yen movements to be weak on Monday as Japanese markets remain closed on a holiday.

The dollar index, an indicator of its value against six major competitors, was slightly higher at 96.64, on track to achieve an eighth consecutive day of gains.

Trade tensions between the two largest economies in the world have contributed greatly to global investor confidence over the past year. Market confidence wreaked havoc last week when US President Donald Trump said he was not planning to meet with Chinese President Xi Jinping before the deadline set for March 1 by the two countries. reach a commercial agreement.

Trump has promised to raise US tariffs on Chinese imports by $ 200 billion, from 10% to 25% currently, if the two sides can not reach an agreement by the 2nd March.

The euro was down slightly against the greenback at $ 1.132 billion in early Asian trade, while the Australian dollar was up 0.15% to $ 0.7099 after a disastrous week during from which he had lost 2.2%.

The strength of the dollar took place despite the accommodative attitude of the Federal Reserve at its last political meeting in January. For the moment, investors attach to the safety of the greenback because of fears of a strong global economic downturn.

The euro has been under pressure, with yields on Europe's largest public debt reaching their lowest level in more than two years. The single currency has lost 2.5% since the beginning of the month.

German benchmark yields were only at 10 basis points of zero percent.

The European Commission sharply lowered its economic growth forecast for the eurozone on Thursday for this year and next, as the largest bloc economies are being held back by global trade tensions and domestic challenges.

Last month, the International Monetary Fund also lowered its global growth forecast.

Elsewhere, the pound was down 0.1% to $ 1.2935. Traders expect the pound to remain volatile because of the great political uncertainty surrounding the Brexit process.