NEW YORK: The dollar rose to a six-day high against a basket of major currencies on Wednesday, rebounding further from a five-week low touched the prior session, supported by quarter-end flows into the greenback as investors also shook off fears of a trade war.
The dollar index, which measures the greenback against a basket of six other major currencies, was up 0.47 percent at 89.794. The index has rallied nearly 1 percent since hitting a five-week low of 88.942 on Tuesday.
"I think what we are seeing is a continuation of bit of a theme that started earlier this week, that is, we are seeing a slight reduction in the overall level of concern about a looming trade war," said Omer Esiner, chief market strategist with Commonwealth Foreign Exchange in Washington.
Global markets were shaken this month after US President Donald Trump moved to impose tariffs on Chinese goods and Beijing threatened similar measures. But fears of a full-blown trade war have eased on hopes negotiations can bring a compromise.
"That has translated into a moderating sense of concern and that's why we are seeing kind of an unwinding of safe-haven bets," Esiner said.
"We did see a rather abrupt turnaround in US equities yesterday, but that was mostly tech-driven as opposed to a sell-off that was driven by broader concerns," Esiner said.
The dollar rose 0.81 percent against the Japanese yen and 0.85 percent against the Swiss franc, viewed as safe-haven currencies in times of market turbulence.
Quarter-end and month-end flows boosted the dollar as global asset and fund managers rebalanced portfolios, analysts said. Data showing fourth-quarter US economic growth slowed less than estimated also supported the greenback.
The euro slipped 0.44 percent against the dollar, but was on track for a fifth straight quarterly gain, the longest such streak since 2008.
Sterling was buffeted by crosswinds as growing hopes Britain will propose a new solution for the Irish border dispute was offset by disappointment over data showing British retail sales fell in March for the first time in five months.
Sterling was down 0.38 percent at $1.41.
The Canadian dollar was slightly weaker against the greenback ahead of Canadian economic data on Thursday.