Dollar rockets to 3-year highs against majors in Europe

The dollar surged to a three-year high against major currencies on Wednesday, as companies and investors worried by the coronavirus outbreak rushed to the safe haven of the world's most liquid currency.
The greenback hit its highest level since April 2017, breaking 100 against a basket of currencies. The index has gained more than 5% in a little over a week and on a seven-day rolling basis had notched up its biggest rise since the dark days of the global financial crisis in November 2008.
A slew of currencies hit multi-year lows against the US dollar, including the British pound, the Australian dollar and the New Zealand dollar. The Norwegian crown hit a fresh record low of $10.6356.
Signs of stress were everywhere as global central banks resumed their efforts to keep money markets functioning normally.
The European Central Bank, the Bank of England and the Swiss National Bank all held dollar liquidity sales on Wednesday, as part of the biggest co-ordinated funding injection by central banks since the 2007-09 financial crisis.
The high demand in these auctions settled some nerves in money markets but some analysts said that given the widespread nature of the dollar shortage, the Fed's swap lines with the major central banks may not be enough.
"There was a concern that people wouldn't take this up sufficiently because of stigmatisation fears. We saw that in 2008. Now we are obviously in a situation where this is not a problem," said Ulrich Leuchtmann, head of FX and commodity research at Commerzbank.
The US Federal Reserve said on Tuesday it would reinstate a funding facility used during the 2008 financial crisis to get credit directly to businesses and households.
Markets have crumbled this month as investors liquidated nearly everything for cash - driving up the dollar's value and the cost of borrowing the greenback abroad.
Export exposed currencies fared particularly badly versus the greenback.
The Australian dollar sunk to a fresh 17-year low of $0.59110 on Wednesday, while the New Zealand dollar hit a decade low of $0.5841 cents.
Meanwhile sterling fell 1.9%, falling below $1.19 to its lowest level since the pound's so-called 'flash crash' in October 2016.
Only perceived safe-haven currencies managed to hold their ground against a strengthening greenback, with the safe-haven yen up around a third of a percent to 107.30 yen while the Swiss franc edged up 0.1% to $0.96055 francs.