Investing.com - The U.S. dollar rallied against other currencies on Tuesday, as Sino-U.S. trade relations escalated.
The U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, rose 0.12% to 95.23 as of 11:00 AM ET (15:00 GMT).
U.S. President Donald Trump threatened on Friday to impose tariffs on almost all Chinese imports, or about $467 billion in goods.
Meanwhile, China is planning to ask the WTO for permission to impose sanctions on the U.S., according to a WTO meeting agenda. Beijing will formally place the request next week, as an apparent response to remarks from Trump. Chinese officials had previously stated they would retaliate on any trade moves from Washington.
Expectations for a Federal Reserve rate hike in September also helped push the greenback higher, as the Job Openings and Labor Turnover Survey (JOLTS) came in higher than expected, indicating employers may have to boost wages to fill open positions.
The dollar rose against the safe-haven yen, with USD/JPY increasing 0.31% to 111.45. In times of uncertainty, investors tend to invest in the Japanese yen, which is considered a safe asset during periods of risk aversion.
The euro inched down due to the strengthening dollar, with EUR/USD falling 0.06% to 1.1586. Sterling was also lower, after news that Bank of England Governor Mark Carney agreed to stay on until January 2020, six months longer than he originally planned to serve. GBP/USD decreased 0.21% to 1.2999.
The Australian dollar was lower, with AUD/USD down 0.28% to 0.7094, while NZD/USD fell 0.32% to 0.6504. The loonie was higher against the dollar, with USD/CAD decreasing 0.16% to 1.3143.