(Updates with midday U.S. trading, adds NEW YORK dateline, byline)
By Caroline Valetkevitch and Joice Alves
NEW YORK/LONDON, March 4 (Reuters) - The euro fell against major currencies and the U.S. dollar rallied
on Friday as worries increased over the impact of the escalating Ukraine-Russia conflict, especially on
Europe's growth outlook.
The euro fell below $1.10 against the dollar for the first time in almost two years, and was last down
1.4% at $1.0916 and on track for its biggest daily percentage decline since March 2020. The
European single currency also hit a fresh seven-year low versus the safe-haven Swiss franc.
Russian invasion forces seized Europe's biggest nuclear power plant on Friday. A blaze in a training
building was extinguished and officials said the facility was now safe, while combat raged elsewhere in
Ukraine in the second week of the assault launched by Russian President Vladimir Putin.
Against the Swiss franc, the euro was last down 1.3% at 1.0020. The euro also sank against
sterling, hitting its lowest level since June 2016. Strategists worry that surging energy and gas
prices will hit Europe's economic growth prospects.
Investors flocked to the U.S. dollar and other safe-haven currencies. The U.S. dollar index
initially pared gains but then rallied further following data Friday that showed U.S. job growth surged in
February. The report raised optimism that the economy could withstand tighter monetary policy.
The index was last up 1%, trading around its highest since May 2020, while the dollar was down 0.6%
against the Japanese yen
"The most compelling story here is the flight to safety, which we've seen coming in ebbs and flows. It
picked up overnight with the fire" in Ukraine, said Amo Sahota, director at Klarity FX in San Francisco.
"That created a pop up in U.S. dollar across the board.
"The big losses have really been focused on European currencies in particular. Euro/dollar is going to be
the big headline grabber," he said. "Economists in general are going to be revising down a lot of their
forecasts."
Also supporting the dollar, investors expect the U.S. Federal Reserve to raise interest rates at its
March 15-16 meeting for the first time since the coronavirus pandemic.
In addition, the Czech National Bank said on Friday it was intervening in the market to stem the
depreciation of the crown. Poland's central bank intervened this week, but the zloty still
hit a 13-year low against the euro, while Hungary delivered its most aggressive rate hike since 2008 as the
forint also tumbled to record lows.
The rouble traded near record lows against the dollar and euro in volatile Moscow trade
, after Russia's credit rating was cut deeper into junk by S&P.
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Currency bid prices at 11:46AM (1646 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Dollar index 98.6330 97.7200 +0.95% 3.105% +98.9250 +97.7200
Euro/Dollar $1.0916 $1.1066 -1.36% -3.98% +$1.1068 +$1.0886
Dollar/Yen 114.7250 115.4400 -0.61% -0.33% +115.5500 +114.6800
Euro/Yen 125.22 127.76 -1.99% -3.91% +127.8100 +125.1500
Dollar/Swiss 0.9180 0.9171 +0.12% +0.66% +0.9210 +0.9166
Sterling/Dollar $1.3211 $1.3345 -1.00% -2.31% +$1.3355 +$1.3202
Dollar/Canadian 1.2764 1.2683 +0.64% +0.95% +1.2792 +1.2670
Aussie/Dollar $0.7355 $0.7329 +0.40% +1.22% +$0.7375 +$0.7301
Euro/Swiss 1.0020 1.0151 -1.29% -3.37% +1.0157 +1.0020
Euro/Sterling 0.8260 0.8284 -0.29% -1.67% +0.8295 +0.8232
NZ $0.6841 $0.6800 +0.59% -0.07% +$0.6843 +$0.6768
Dollar/Dollar
Dollar/Norway 8.9790 8.9215 +0.77% +2.05% +9.0505 +8.9040
Euro/Norway 9.8067 9.8583 -0.52% -2.06% +9.8838 +9.7968
Dollar/Sweden 9.8756 9.7338 +0.02% +9.51% +9.9621 +9.7368
Euro/Sweden 10.7873 10.7849 +0.02% +5.41% +10.8519 +10.7627
(Reporting by Caroline Valetkevitch in New York and Joice Alves in London, additional reporting by Alun
John; Editing by Robert Birsel, Raissa Kasolowsky, Louise Heavens and Jonathan Oatis)
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