The US dollar surged higher at the opening of Asian session trading after being driven by its demand as a safe-haven following the implementation of the latest sanctions measures in Shanghai.
Shanghai which is also China’s financial hub with a population of 26 million people has ordered all firms to suspend manufacturing and encourage work from home in two -stage restrictions for 9 days.
At the time of writing, the dollar index is trading higher at around 99.00 against most major currencies.
The strengthening was also supported by a surge in 10 -year US bond yields which had touched the 2.50% level at the end of last week's trading, the highest since May 2019.
The surge of the US dollar earlier in the week has pushed euro and pound currency trading lower. Commodity -linked currencies, meanwhile, struggled to maintain their gains last week.
The Aussie and New Zealand dollars traded slightly lower, but overall were still at four -month highs. The Canadian dollar also depreciated but still traded around two -month highs.
The publication of the US ADP and NFP jobs reports will be the main focus of investors this week which is expected to show slightly slower growth in March.
Meanwhile, developments on the Ukraine-Russia war remain the focus but its impact on the currency market is seen to be diminishing by only affecting European currencies which may be affected by economic sanctions against Russia.
