The US dollar on Friday rose as investors sought safe havens after Austria said it would be the first country in Western Europe to reimpose a full lockdown amid surging COVID-19 infections and Germany said it might follow suit, sending the euro lower.
The US dollar index, which tracks the greenback against a basket of six major currencies, was up 0.489 percent at 96.029, close to the 16-month high of 96.266 hit on Wednesday. For the week, the dollar was up 0.96 percent.
The euro, which has been on its back foot all week, hit a 16-month low amid a COVID-19 surge in Europe and as expectations have grown that interest rates would be hiked faster elsewhere, particularly in the US.
Photo: AP
US Federal Reserve Governor Christopher Waller said the US central bank should speed up the pace of tapering its bond purchases to give more leeway to raise interest rates from their near-zero level sooner than it expects if high inflation and the strength of job gains persists.
At a separate event, Fed Vice Chairman Richard Clarida said that it “may very well be appropriate” to discuss speeding up the Fed’s asset purchase wind-down when it next meets on Dec. 14 and 15.
“The greenback right now is certainly benefiting from signs of a strengthening US economy and from safe-haven flows due to renewed worries about the virus,” Western Union Business Solutions senior market analyst Joe Manimbo said.
In Taipei, the New Taiwan dollar rose against the greenback, gaining NT$0.008 to close at NT$27.795, up 0.15 percent from a week earlier.
Commodity-linked currencies, such as the Australian, New Zealand and Canadian dollars, often seen as risky, all declined.
The euro fell more than 1 percent this week versus the US dollar and was down 0.74 percent on the day at US$1.12895, having earlier touched US$1.1248, its weakest level since July last year.
European Central Bank President Christine Lagarde doubled down on her cautious position, saying that the ECB should not tighten policy as that could undermine recovery.
The Australian dollar was down 0.58 percent at US$0.72335, while the New Zealand dollar was 0.72 percent lower at US$0.69945.
The Canadian dollar slid 0.42 percent to C$1.2652.
The Japanese yen, also considered a safe-haven currency, improved after Austria’s lockdown announcement, and was up 0.22 percent versus the dollar at ￥113.99.
Sterling shed some of its recent gains and was down 0.39 percent at about US$1.3448.
Additional reporting by CNA, with staff writer
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