Dollar holds gains as surging coronavirus cases boost safe-haven bid

The dollar held onto gains against a basket of currencies amid rising coronavirus cases in Europe on Thursday. This fueled investor’s worries that renewed lockdowns would drag the already weak economic recovery.

The dollar index steadied at 93.39 after gaining 0.3% in early trade. Against the Japanese yen, the dollar firmed at 104.45 after falling to a one-month low in the last session. 

Worries about economic damage grew as France and Germany reimposed lockdowns on Wednesday.

The euro traded at $1.1753 following a one-week low of $1.1718 hit overnight. It slowly climbed to 122.79 against the yen after sliding to its lowest level since July.

Traders braced for high volatility as the U.S. presidential election draws near and as Europe struggles to contain the second wave of coronavirus cases.

In onshore trade, the yuan rose to 6.7104 on the dollar. It stood at $6.7095 in offshore trade as volatility hit a more than five-year high a few days before the U.S. election.

The Aussie stood at $0.7064, boosted by a 1% gain in U.S. stock futures. The kiwi was up 0.18% to $0.6649.