The dollar held a gain against most of its 16 major counterparts as investors sought haven assets amid tension in Ukraine and before Federal Reserve Chair Janet Yellen speaks today.
The greenback’s appeal as the world’s reserve currency was enhanced as deadly clashes in Ukraine prompted the U.S. and European Union to consider adding to sanctions against Russia. Australia’s dollar erased an earlier loss after a report showed growth was stronger than forecast in China, the South Pacific nation’s biggest trading partner. The yen fell as Japanese stocks rose the most in almost two months. New Zealand’s kiwi slid a second day after inflation slowed and dairy prices fell.
“Ukraine is bubbling under, and it has huge potential to be mismanaged by Europe and the U.S.,” said Derek Mumford, director at Rochford Capital, a currency risk-management company in Sydney. Russian President Vladimir Putin may be “pushed into a corner and will have to invade, which won’t be good for Europe, but is potentially good for the U.S. dollar.”