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HONG KONG: The dollar began the week just off a 20-year high against peers, as investors sought safety amid concerns about global growth, while cryptocurrency markets appeared to find some stability following last week's turmoil.
After six weeks of gains, the dollar index was at 104.54, having briefly crossed the 105 level on Friday, its highest since December 2002.
Investors have rushed to the safe-haven currency due to fears about the U.S. Federal Reserve's capacity to reduce inflation without precipitating a recession, the Ukraine situation, and China's zero-COVID-19 policy.
“Growing global growth concerns boost USD strength,” say Barclays analysts.
On Tuesday, the US retail and production figures are due, as are public remarks from many Fed officials.
“Any pushback on the idea that 75-basis point rate rises are off the table will be watched closely.”
Markets expect 50 basis point hikes at the Fed's next two meetings, but higher increases are possible.
Chinese retail and manufacturing numbers are also due later Monday.
Barclays predicts that China's slowing GDP will keep commodity G10 currencies under pressure and the USD supported.
The euro started the week around its lowest level since early 2017, hurt by a strong dollar and the Ukraine war.
Monday morning, the euro traded at $1.0398, slightly above Thursday's $1.0354 trough, its lowest since early 2017.
This week, investors will also hear from ECB officials.
Sterling, like the euro, fell to $1.2256 on Monday, after hitting $1.2156 last week due to weaker-than-expected first-quarter GDP numbers.
Britain has labor market, inflation, and consumer confidence data next week.
Monday morning's yen/dollar rate was 129.43. Last week was its first increase since early March, as growth uncertainties halted the rise of U.S. Treasury yields.
With Japan's yields low, the yen is vulnerable to increased US yields.
Crypto markets had a peaceful weekend after last week's turbulence caused by TerraUSD's dollar peg break.
Bitcoin was selling about $31,000 after dropping to $21,400 on Thursday.
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