By Gina Lee

Investing.com – The dollar was up on Wednesday morning in Asia, at its highest level since the COVID-19 pandemic began and set for its best month since 2015. U.S. currency gained momentum due to increased interest rates in the U.S. and an increase in safe-haven assets, thanks to slower economic growth in China.

At 11:35PM ET (3:35 GMT), The Greenback Index, which measures its value against a basket currency mix, increased 0.02% to 102.335 (0.02% increase). Near its overnight peak of 102.37 the U.S. currency reached its highest level since March 2020.

This pair rose 0.43% from 127.77 to 127.77.

This pair rose 0.7% from 0.7170 to 0.7670, and went up by 0.1% from 0.6572.

Both the pair fell 0.03% at 6.5551, and both were up 0.06% at 1.2580.

In the meantime, the euro dropped below its COVID-19 lows of $1.0635 to trade in early trading, an all-time low for five years. After Russia’s Gazprom announced that it would stop gas supply to Bulgaria and Poland later in the day, concerns are mounting about Europe’s energy security and economic growth.

Commodity currencies saw gains also capped with the New Zealand Dollar nearing its lowest level in 2022 and the Australian Dollar at a two month low.

also showed that Australia’s growing 2.1% and 5.1% in the first quarter of 2022.

Citi analysts wrote in a note, “The Dollar is the Hedge in Markets Currently,” while gold and other commodities are not as effective.

The note stated that the dollar was a “quality carry” currency. The dollar offers greater yield than other FX safe-haven options.

Flight to safety also has helped the yen, which rose from previous lows to an all-time high of one week. The pound also had its strongest day in over two years.

It will also announce its policy decisions on Thursday. Markets are concerned about the possibility of adjustments to forecasts and even changes in policy to stop the recent drop in the yen. However, Fumio Kishhida, Japan’s Prime Minister, dismissed such fears on Tuesday.

Chinese yuan fell more than 3.5% during the first month and traded at 6.5902 USD in offshore trade. After North Korea’s pledge to expand its nuclear arsenal, the South Korean won plunged to an all-time low of 2.92 per dollar in offshore trade.

The pound has dropped more than 2% against the dollar in the week to date after worse-than-expected retail sales data prompted a re-think of the U.K.’s interest rates outlook. The pound fell to a 21-month high on Wednesday.

In cryptocurrency, the, which was quickly sold as investors pulled back from risky assets overnight, traded close to its six-week lowest at $38,228.