05:56 GMT02 March 2021
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    The US currency has strengthened significantly against the backdrop of drone attacks on Saudi oil facilities and turmoil in Hong Kong earlier this month.

    The US dollar traded at its strongest level in more than two years against both the euro and a basket of currencies in the ICE dollar index on Monday.

    The dollar was up 0.3 percent against the euro earlier in the day, gaining 4.3 percent against the European currency this quarter, when markets specifically faced attacks on Saudi Arabia oil facilities and unrest in Hong Kong.

    Two drones attacked Saudi Aramco oil facilities on 14 September, causing a major fire and partially disrupting oil production. The incident was claimed by Yemen's Houthis, but the US put the blame on Iran. Tehran has strongly denied all the allegations.

    September also saw the continuation of a wave of rallies in Hong Kong against proposed amendments to the city's extradition law. Protests often turned violent after demonstrators began engaging in clashes with the police.

    The US Dollar Index tumbled in August before soaring sharply in early September amid slowing global economic growth and more aggressive monetary easing policy pursued by the global central bank toward investors.

    Tom Essaye, founder of the Sevens Report, was cited by NBC News as saying at the time that “going forward, the dollar will have a hard time declining unless the Fed gets aggressively dovish, simply because global growth remains lacklustre and global central banks are easing policy or are about to ease policy.”

    Also boosting the dollar was a fall in the UK pound which fell close to a three-year low as British lawmakers prepared to vote on the first stage of their plan to block new Prime Minister Boris Johnson from implementing a no-deal Brexit.

    US President Donald Trump, for his part, remained downbeat about the stronger dollar, blaming the Federal Reserve’s “high” interest rate levels for the dollar’s strength.

    “As your President, one would think that I would be thrilled with our very strong dollar. I am not! The Fed’s high interest rate level, in comparison to other countries, is keeping the dollar high, making it more difficult for our great manufacturers like Caterpillar, Boeing, John Deere, our car companies, & others, to compete on a level playing field,” Trump tweeted in August.


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