Dollar to end week strong as market tensions remain, boosting safe-haven bid

The dollar rose on Friday, on course for a weekly gain, as lingering tension from a coordinated assault on a U.S. hedge fund short positions lifted demand for safe havens.

The dollar benefited from safety buying since the beginning of the week when investors feared that Biden’s U.S. stimulus plan will not be as big as the proposed $1.9 trillion.

The dollar index rose 0.2% to 90.757 in Asian trade, increasing its weekly rise to 0.6%. Against the safe-haven yen, the dollar gained 0.3% to 104.52, adding to a 0.2% gain from the last session.

Analysts expect the dollar to return to a downward trend where it lost almost 7% of its value in 2020. 

The euro fell 0.2% to $1.20955. Production delays of COVID-19 vaccines in Europe turned into a spat between the drugmakers and the European Union over directing limited supplies of the vaccine.