NEW YORK: The US dollar climbed to a three-week peak on Tuesday, helped by losses in sterling on renewed worries about Brexit as well as investors' aversion to risk amid a sell-off on Wall Street.
Sterling fell to a four-week low against the dollar and was last down 0.9% at $1.3045.
Britain had gone into Tuesday's fresh round of Brexit trade talks warning it was ramping up no-deal preparations. A sense of crisis took hold as the Financial Times reported the head of Britain's legal department had quit over suggestions Boris Johnson wanted to override parts of the existing divorce deal.
In mid-morning trading, the dollar index rose 0.3% to 93.294, after earlier advancing to a three-week high of 93.483.
The greenback, however, struggled against the safe-haven yen, falling 0.3% to 105.97, weighed down by weakness in US stocks.
The yen rose despite data showing Japan's economy shrank an annualised 28.1% in April-June, worse than the initial estimate of a 27.8% contraction, revised data from the Cabinet Office showed on Tuesday.
The euro, meanwhile, fell to a two-week low versus the dollar, and was last down 0.3% at $1.1785 ahead of the European Central Bank's post-summer meeting later in the week.
The yuan dipped against the dollar too in the offshore market, after US President Donald Trump warned about "decoupling" the US and Chinese economies. The dollar was last up 0.2% at 6.848 yuan.
The Australian dollar reversed course to drop 0.5% to US$0.7239 and the New Zealand dollar slid 0.8% to US$0.6636 following a Sunday statement from the central bank, which again raised the prospect of negative rates.
In emerging markets, Turkey's lira hit another record low and Russia's rouble sagged to it lowest since April amid ongoing talk about fresh Western sanctions.
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