Dollar rallies as risk appetite fades
The dollar reached a two-week high on Tuesday as risk appetite faded amid a stock sell-off. This came after U.S. Treasury Secretary Janet Yellen said that interest rates may need to increase to prevent the economy from overheating.
The dollar’s safe-haven appeal was further supported when the Nasdaq slid over 2%, the S&P over 1%, and the Dow Jones Industrial Average 0.3%.
Tuesday’s bounce reversed Monday’s losses that left the dollar only 1% above a one-month trough hit last week. The dollar index rose 0.3% to 91.278 on Wednesday, down over 2% in April.
The dollar rose 0.8% to $0.7704 against the Aussie and stood at $0.7138 against the dollar, despite commodity prices being generally firmer across the board.
The euro dropped 0.4% to $1.2013 on the dollar and the pound slid 0.1% to $1.388. Against the yen, the greenback climbed 0.2% to 109.32.