Currency Note US Dollar

US Dollar benefits from safe haven status

By Ricky Bean August 7th, 2014

The US dollar started yesterday by continuing the positive trend it experienced on Tuesday. The US currency advanced to the highest point in nearly nine months against the euro, although this did reverse later in the day to leave it near its opening levels. Further positive results from US economic data helped to encourage investors. These, coupled with uncertainty over the Ukraine-Russia situation, combined to push the dollar up. The trade balance from the country showed that the deficit had shrunk by 7% in June.

With the possibility of increased friction in Ukraine, the dollar benefited due to its safe haven status as investors looked to reduce risk. Today holds just the one piece of interest for US investors, but being from the labour market it is an important one. The figure due is that of unemployment claims, which will be of particular interest given its strong ties to possible interest rate rises. As such, positive figures could continue to bolster hopes of this happening earlier than expected.