The US dollar rose on Friday as concern about next week’s European parliamentary elections dented demand for the euro, while the British pound dropped to a four-month low on worries about the UK’s exit from the EU.
The US dollar index, which measures the greenback against six major rivals, rose 0.16 percent to 98.01, up 0.7 percent for the week.
In Taipei, the New Taiwan dollar on Friday fell against the greenback, slipping NT$0.132 to close at NT$31.297, down 1 percent from last week’s NT$30.958 per US dollar.
The US dollar has been favored as a safe-haven currency even as the US-China trade spat escalates.
The euro has been hurt this week by Italian Deputy Prime Minister Matteo Salvini’s comments that EU rules harm his country.
The elections would shake up the continent, leading to a relaxation of budget rules and influencing the choice of the next central bank chief, Salvini said on Friday.
“The market is a little bit concerned about European elections. It seems to be a flow into the dollar as a bastion of last resort,” said Boris Schlossberg, managing director of foreign exchange strategy at BK Asset Management in New York.
The euro briefly pared losses after the White House said that US President Donald Trump is delaying a decision for as long as six months on whether to impose tariffs on imported cars and parts to allow for more time for trade talks with the EU and Japan.
The pound fell to the lowest since Jan. 15 after cross-party Brexit talks collapsed and concern grew about the impact British Prime Minister Theresa May’s likely resignation would have on the UK’s exit from the EU.
The offshore Chinese yuan fell to its lowest levels since November last year after China said that the US must show sincerity if it is to hold meaningful trade talks as Trump dramatically raised the stakes with a potentially devastating blow to Chinese tech giant Huawei Technologies Co (華為).
The world’s two largest economies are locked in an increasingly acrimonious trade dispute, in which they have imposed escalating tariffs on each other’s imports.
“Rhetoric from both sides is getting more heated, making a US-China deal seem a long way off,” Win Thin, global head of currency strategy at Brown Brothers Harriman & Co in New York, said in a report.
“At this point, this means there will be no high-level negotiations between the two until a potential Trump-[Chinese President] Xi [Jinping, 習近平] meeting at the G20 meeting late next month. This means the next round of tariffs will likely come into play, signaling further escalation and making a deal that much harder,” Thin said.
The Australian dollar dropped to its lowest level since Jan. 3 on the escalating trade tensions.
Additional reporting by CNA, with staff writer
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