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Title: Dollar spikes on Ukraine jitters after Russia reports attack


Feb 17, 2022 02:10AM ET


By: AnalysisWatch


The dollar strengthened on Thursday after Russian news of mortar shelling in eastern Ukraine jolted market jitters and sent investors to safe-havens.


The Russian-backed rebels accused Ukrainian forces of shelling their territory in violation of agreements to end the conflict in the disputed Donbas region, the RIA news agency reported, a report Ukraine later denied.


Russia has amassed more than 100,000 troops near the Ukrainian border, and the West has threatened Russia with new sanctions if it attacks.


The euro fell as much as 0.4% as traders immediately saw the threat of a major war.


However, denials from Ukraine and the fact that the alleged attack took place in an already disputed area calmed the situation, and the euro last traded at USD 1.1354.


The risk-sensitive Australian dollar lost as much as 0.6% before settling 0.2% lower at $0.7185. The yen, which is considered a safe haven, rose about 0.1% to $115.29 per dollar.


The Russian ruble, sensitive to the prospect of war amid looming sanctions against Russia, fell 0.7%.


The standoff on Europe's eastern fringe is one of the most serious crises in East-West relations in decades. Earlier, a U.S. official said that Russia is reinforcing its troops on the border with Ukraine and will not withdraw as Moscow claims.


Futures on U.S. stocks, which are considered a safe haven, fell along with the sentiment, though a lack of clarity on the situation limited larger moves.


The dollar index rose 0.1% to 95.927.


The data showed Japan posted its biggest one-month trade deficit in eight years in January after Europe's trade deficit widened in December due to soaring energy prices.


Expectations kept the kiwi and the pound steady.


The New Zealand dollar was last unchanged at $0.6685, after earlier hitting a one-week high of $0.6703.

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