Dollar boosted by safe-haven demand as fears over European lockdowns, U.S. taxes cap risk sentiment

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The safe-haven dollar was on course for a four-month high on Wednesday as worries over a third COVID-19 wave in Europe, possible U.S. tax hikes, and rising tensions between China and the West capped risk appetite.

The dollar index climbed to a two-week high of 92.436 in Asian trade. It hovered right below a four-month high of 92.506 hit earlier this month.

The euro was on course for a four-month low of $1.18355 after Germany extended a lockdown and discouraged citizens from celebrating the Easter holiday in public places.

The safe-haven yen was broadly stronger. The Aussie fell to as low as $0.7595, a level not seen since Feb. 5, and to 82.41 against the yen.

The pound dropped to $1.37050, its lowest since early February. 

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