The dollar is headed for its best week since the financial crisis, fueled by a rebound in investor appetite for riskier assets and a desire by companies and others to park funds in the world’s favored reserve currency.
The Bloomberg dollar index is up 3.4% on the week, the biggest surge since 2008, taking it to the highest in almost three years. The greenback extended gains as central banks and governments moved to cushion the global economy from the damage of the coronavirus. The Federal Reserve, for example, has promised trillions of dollars of liquidity in coming weeks to keep short-term funding markets functioning smoothly. The Bank of Canada slashed rates Friday in a surprise move. The S&P 500 rose after stocks’ worst day since 1987, while the yen and Swiss franc, traditional havens, slumped.