Dollar firms as rising coronavirus cases weigh on recovery fears

The dollar firmed on Wednesday as a surge in new U.S. coronavirus cases and the reinstatement of lockdowns in several countries prompted a safe-haven bid.

Risk sentiment also weakened after Federal Reserve officials stated that the rising coronavirus cases could impact economic growth.

The yuan slid to 7.0228 against the dollar as most Asian currencies traded in narrow ranges. The dollar stood at 107.67 on the yen.

The euro traded at $1.1274 as the greenback held to its gains from the last session. The dollar bought 0.9429 Swiss franc. The British pound stood at $1.2549 and at 89.86 pence per euro.

The pound was on its way to three-week highs after Prime Minister Boris Johnson reiterated that he was committed to reaching a trade deal with the European Union.

The U.S. Treasury yields and equities fell as coronavirus cases in the United States hit 3 million on Tuesday. Adding to caution was Fed officials’ statement that rising cases could take a toll on consumer spending and job gains.

Some traders warned that the greenback could break out of its range against the Japanese yen as currency options will expire on Wednesday and Thursday.

Commodity currencies Australian and New Zealand dollars were little changed at $0.6939 and $0.6546, respectively.