NEW YORK: The US dollar was slightly lower against a basket of major currencies on Tuesday in choppy trade, getting whipsawed by developments in Ukraine a day after Russian President Vladimir Putin recognized two breakaway regions in the country and ordered troops to the area.
The Kremlin said it remained open to diplomacy with the United States and other countries as it faced actions from a slew of countries. Britain published a list of sanctions and Germany froze the Nord Stream 2 Baltic Sea gas pipeline project, which would have significantly increased the flow of Russian gas.
The euro rose versus the dollar, after earlier touching its lowest level since Feb. 14, buoyed in part by the hope for talks and economic data that showed business morale in Germany improved in February across all sectors to its highest since August.
The dollar index fell 0.134%, with the euro up 0.21% to $1.1334.
“Putin is running the show here, but the markets are not responding as if they are really fearful that what happened is an irredeemable escalation that is going to end up with the kind of sanctions that wreck economies, or at least will wreck the global recovery,” said Joseph Trevisani, senior analyst at FXStreet.com in New York.
“The game is still in the air, and the markets know it; they don’t see it as a great change in the situation.”
Russia’s rouble strengthened 1.51% versus the greenback at 79.25 per dollar. Sterling was last trading at $1.3594, down 0.03% on the day.
The dollar also gained some ground after data from IHS Markit showed US business activity in February regained speed as the drag from a surge in COVID-19 cases during the winter ebbed.
Other data, however, showed US consumer confidence fell for a second straight month in February.
After initially strengthening against the dollar, safe havens such as the Swiss franc and Japanese yen gave back gains against the greenback. The dollar rose 0.58% against the Swiss franc while the yen weakened 0.29%.
As oil prices rose, currencies tied to crude strengthened, with the Canadian dollar up 0.17% versus the greenback at 1.27 per dollar.
In cryptocurrencies, Bitcoin last rose 2.06% to $37,828.66. Ethereum was lust up 1.84% at $2,630.21.
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