Dollar maintains one-week high following weeks of losses

The dollar maintained its gains on Tuesday after climbing to a one-week peak on the euro. The greenback’s steady gain is in light of the U.S.-China tensions and the deadlock on the U.S. coronavirus aid supporting safe-haven sentiment.

The U.S.-China tensions escalated after a round of exchanges between the two countries, including Beijing’s sanctions on 11 U.S. citizens as a response to Washington’s sanctions on Chinese and Hong Kong officials.

U.S. Treasury Secretary Steven Mnuchin also said that Chinese companies that do not comply with accounting standards will be removed from U.S. stock exchanges at the end of 2021.

The market’s response to the escalating tensions was limited, but analysts say it will have longer-term implications.

The euro steadied at $1.1736 after the dollar fell for seven straight weeks. The euro was boosted by the market perception that the euro zone was recovering faster than the U.S. economy amid the pandemic.

Elsewhere, the Turkish lira traded at 7.2785 on the dollar. 

The Norwegian crown was up 0.3% at 9 to the dollar, while the Canadian dollar steadied at $1.33. The two currencies, along with the Russian rouble, were the top gainers this week, according to MUFG analysts.