WASHINGTON (dpa-AFX) - The U.S. dollar climbed higher on Friday as worries about the rapid spread of Omicron variant of the coronavirus pushed up the demand for the safe-haven currency.
Also, traders continued to weigh the impact of monetary policy moves of the major central banks.
Dr. Anthony Fauci, President Joe Biden's top medical advisor, said that the U.S. is experiencing a resurgence of the delta variant and that Omicron will become the dominant Covid-19 variant in the United States within a few weeks.
Fauci also said that some of the rapid at-home Covid-19 tests available in the U.S. may not accurately pick up the new super mutant Omicron variant.
The Fed announced on Wednesday that it would double the speed of the tapering of its bond purchasing program and projected three rate hikes in 2022, citing rising price pressures and improvement in the labor market.
The Bank of England raised its key interest by 0.15 percentage points on Thursday as policymakers viewed that some moderate tightening is required to bring inflation down. The committee unanimously decided to maintain the bond purchase programme at GBP 895 billion.
The European Central Bank announced a reduction in support for the euro zone economy by another notch but promised copious support for 2022. The bank also indicated that any exit from years of ultra-easy policy will be slow.
ECB President Christine Lagarde said policymakers are unlikely to raise interest rates next year after the bank unveiled plans to start tapering its stimulus in March.
The dollar index is up nearly 0.7% at 96.69.
Against the Euro, the dollar firmed to $1.1244, gaining from $1.1330.
The dollar is trading at $1.3239 against Pound Sterling, advancing more than 0.6% from Thursday's close of $1.3323.
The dollar is trading at 113.73 yen, recovering from a low of 113.15. The Bank of Japan decided to scale back its pandemic related funding measures as the economy is set to recover amid waning supply-side constraints.
The board, governed by Haruhiko Kuroda, decided to end the additional purchases of CP and corporate bonds at the end of March 2022 as scheduled.
Against the Aussie, the dollar is at 0.7124, gaining from 0.7184.
The dollar is up against Swiss franc, fetching CHF0.9244 a unit, about 0.54% more than Thursday's close of CHF0.9194.
The Loonie is down sharply against the dollar at 1.2899 as crude oil prices fell sharply on worries about outlook for energy demand.
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