The dollar rose against the euro and yen after China boosted the yuan following a week-long holiday, helping ease global financial turmoil that had spurred investors to bet the Federal Reserve will delay raising U.S. interest rates.
The greenback advanced for a second day versus the currencies often perceived as haven assets after a report Friday showed U.S. retail sales increased more in January than forecasts. Large hedge funds and speculators cut their bets on the dollar’s gains last week by the most since June. The Australian and New Zealand dollars surged as stock gains boosted risk sentiment, even after figures showed a slump in exports and imports for China.
“For the short term, I wouldn’t fight this trend,” said Adam Cole, head of global foreign-exchange strategy at Royal Bank of Canada in London. “Longer term we still have major concerns over China but for the moment it back-
stops risk sentiment and that’s negative for the yen and euro.”
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