TOKYO- The dollar held onto gains against most currencies on Thursday as signs of an economic slowdown in Europe and in the United States revived concerns about the fallout from a second wave of coronavirus infections.
The euro, already hit by worries about a return to severe lockdown restrictions, faces an additional hurdle later on Thursday with the release of data on German business sentiment.
The dollar is likely to continue to rise as another spike in coronavirus cases in Europe boosts its safe-haven appeal, while Federal Reserve policymakers called on the US government to provide more fiscal support.
“Risk is being sold across the board, and there is a big unwinding of dollar shorts,” said Yukio Ishizuki, foreign exchange strategist at Daiwa Securities, referring to investors abandoning bearish dollar bets.
“Questions surrounding the coronavirus and the need for even more stimulus are turning flows back to the dollar.”
The dollar traded at $1.1671 per euro on Thursday in Asia, just shy of a two-month high reached on Wednesday.
The greenback held near a nine-week high against the Swiss franc at 0.9225, and also held on to gains made in the previous session against the Japanese currency, to stand at 105.42 yen.
The pound bought $1.2732, near its weakest level against the US currency since late July. — Reuters