Dollar higher as safe-haven flow returns
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Sterling rallied versus a broadly weaker Euro, which was trading softer due to riskier assets in the region weakening and the European Central Bank disputing Germany’s court challenge to its money-printing plans.
Boris Johnson’s plan to ease restrictions further has led to health experts speculating that it could cause a second wave of Covid-19 which is a big risk to the the UK economy and the pound.
The dollar rallied on Thursday as safe-haven flow returned to the greenback owed to growing fears over a rapid rise in coronavirus infections. Furthermore, worsening trade tensions between the US and the European Union also contributed to safe-haven demand and a stronger USD.
Over 36,000 new coronavirus cases were recorded on Wednesday which has made investors more pessimistic about the chances of a quick economic recovery. With the number of cases rising by the day and trade tensions still on the table, this has led to an increase in demand for the safe-haven dollar.
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