Dollar Down Euro Struggles To Retrieve Losses From Russian Invasion of Ukraine!

Dollar Down Euro Struggles To Retrieve Losses From Russian Invasion of Ukraine!

The dollar was down on Friday morning in Asia, and the euro attempted to claw back its losses from the previous day.

The Russian invasion of Ukraine on Thursday hit the single currency hard, and investors fled towards safe-haven assets including the dollar, Japanese yen, and Swiss franc.

The U.S. Dollar Index that tracks the greenback against a basket of other currencies inched down 0.13% to 96.960 by 10:32 PM ET (3:32 AM GMT).

It rose as high as 97.740, its highest level since June 2020.

The USD/JPY pair was down 0.22% to 115.27.

The AUD/USD pair edged up 0.17% to 0.7175 and the NZD/USD pair inched up 0.04% to 0.6694.

The Reserve Bank of New Zealand aims to hike interest rates as quickly as possible to contain inflation and avoid the need for even greater policy tightening in the future, according to Governor Adrian Orr.

The USD/CNY pair edged down 0.16% to 6.3813 and the GBP/USD pair was up 0.26% to 1.3409.

The Russian rouble also fell to a record low of 89.986 per dollar overnight, before recovering slightly.

The euro last traded at $1.1196 after hitting its lowest level since May 2020, or $1.1106. The pound and the riskier Australian dollar also suffered losses.

With both currencies struggling to recover from their losses.

Meanwhile, the U.S. dollar fell against the yen and Swiss franc.

The greenback slid 0.48% on the Japanese currency on Thursday and was at 0.9241 against the Swiss franc after losing 0.85% the previous day.

In the biggest attack on a European state since World War Two, Russia launched an attack on Ukraine on Thursday.

Tens of thousands of people have fled their homes and Ukrainian forces fought on multiple fronts.

The U.S. responded by slapping sanctions on Russia.

Impeding the latter's access to foreign currencies alongside sanctions against banks and state-owned enterprises.

"The first order impact is naturally in Russia and Ukraine... but there is an impact on Asia Pacific bond and foreign exchange markets as well."

MarketAxess APAC head Riad Chowdhury told Reuters.

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This has led to a "flight-to-quality type move both in global assets moving to the dollar and yen as well as in emerging markets,” Chowdhury added.

Investors were also calculating the impact of the crisis in Ukraine on central banks’ monetary policies.

Some officials from the European Central Bank, even those who could be perceived as hawkish, said the situation in Ukraine could cause the central bank to delay the start of asset tapering.

In the U.S., investors and some officials said the conflict would likely slow, but not stop, imminent interest rate hikes from the U.S.Federal Reserve. -

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