© Reuters.
Investing.com – The u.s. dollar flirted with the tops of the last two years against a basket of currencies on Thursday as persistent concerns about the tensions in global trade have pushed investors to take refuge in assets shelters.
Trade tensions between the United States and China showing no sign of abating, investors fear that the global economic growth is affected, which has led to a growing aversion to risk in recent sessions.
The dollar index was at 98.090 at 10h05, not far from a two-year peak in 98.371 reached a week ago. The index is up more than 2% for the year.
“The outlook for global growth and the impact of the trade dispute, in the course remain a key issue for the markets,” said Michael McCarthy, a strategist-in-chief of markets at CMC Markets.
“The data on the next twenty-four hours could potentially confirm or dispel the gloom,” he wrote in a note.
The chinese vice-minister of Foreign Affairs, Zhang Hanhui, suggested Thursday that the issue of trade relations between china and the us was far from being resolved, stating that the cause of commercial disputes is an “economic terrorism naked”.
This comes a day after the chinese newspapers have announced that Beijing might use the exports of rare earths against the us government, as us president Donald Trump said that he was “not yet ready” to conclude a trade agreement.
The investors turned to the second estimate of growth in the first quarter in the United States, scheduled for later in the day, as well as the weekly report on applications for unemployment.
“As the United States are not at risk of falling into a recession soon, if it is probable that the sense of the risk improves as a function of the strength of the economy,” said Ayako Sera, a strategist of market to Sumitomo Mitsui Trust Bank.
The dollar remained almost unchanged even after the reference interest rate Treasury us 10-year have reached 2,210%, their lowest level since mid-September 2017.
The status of the greenback as a global reserve currency has a tendency to attract investment in safe haven in times of market turmoil and political tensions. The yield on US 10-years were 2,282% on Thursday morning.
The dollar was also supported by the weakness of the euro on new signs of political tensions between Italy and the European Union.
The European Commission wrote on Wednesday to the Italian government asking it to explain to a deterioration of the public finances of the country, thus paving the way for a possible future confrontation.
The common currency moved to 1,1124, recovering somewhat after a fall of 0.8% in three consecutive sessions of declines.
The australian dollar added 0.2% to 0,6930.
The dollar was up against the yen to 109,81, about 0.5% above the lowest in more than three months of 109,02 touched on may 13.
–Reuters contributed to this report