By Sarah Turner, MarketWatch
SYDNEY (MarketWatch) —The dollar ticked up against several major rivals on Monday, as investors sought the greenback while tensions continued to flare in the Middle East and North Africa.
The dollar index (DXY 77.70, +0.04, +0.05%) rose to 77.72 on Monday, extending gains from late North American trading Friday when it was at 77.632 amid reports that Iran had received permission from Egypt to send warships through the Suez Canal.
That would mean Iran would sail past Israel’s shores for the first time since the Islamic Revolution in 1979.
The dollar’s gains on Monday followed escalating violence in Libya over the weekend, as protesters try to topple the 42-year rule of Moammar Gadhafi.
Demonstrations also took place in Morocco for the first time and continued in Bahrain and Iran.
The dollar bought 83.09 Japanese yen (USDYEN 83.1400, +0.0800, +0.0963%) , down from ¥83.12 in late North American trading on Friday. Like the dollar, the yen is viewed as a “safe-haven” currency, as investors seek lower-yielding assets.
The euro (EURUSD 1.3678, -0.0022, -0.1606%) declined to $1.3674, from $1.3696 in late North American trading on Friday, while the British pound (GBPUSD 1.6238, -0.0022, -0.1353%) traded at $1.6226, down from $1.6240 on Friday.
The Mideast protests likely took attention away from the weekend’s meeting of top finance officials in France, although strategists said that the meeting wasn’t likely to be a game-changer for currency investors in any case.
The delegates at the Group of 20 meeting reached a tentative deal which could lead to the introduction of indicators to help prevent future financial crises, according to reports.
“Importantly, effective exchange rates and guidelines for current account balance levels were not explicitly included in the list of indicators,” noted strategists at Barclays Capital.
“Overall, we think the G-20 meeting made a small step toward establishing guidelines for dealing with global imbalances and will not have a directional impact on foreign exchange,” they added.
