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The U.S. Dollar traded at a five week high against its top global peers Friday as investors plowed cash into safe-haven assets amid questions over the fate of trade talks between Washington and Beijing and deepening concerns for world economic growth.

Investors favored cautious assets in overnight and early European trading Friday following comments from President Donald Trump that confirmed reports he won't be meeting with China leader Xi Jinping before their agreed March 2 deadline on trade talks.

Yesterday's sharp cuts in growth forecasts by both the Bank of England and the European Commission, as well as dovish signalling from central banks around the world, suggest any hopes of a near-term bounce in global economic growth have been put aside amid rising geo-political risks, slowing corporate earnings and uncertain trade negotiations. 

"Not only did these reports take their toll on equity markets, they also triggered a rebound in the dollar," said Craig Erlam, senior market analyst at Singapore-based brokerage Oanda. "The greenback was favoured throughout the escalation of the trade war and has softened since talks began, on hope that an agreement can be found. The latest setback reversed the trend earlier in the session and saw the dollar trading back around 2019 highs."

The U.S. dollar index, which tracks the greenback against a basket of six global currencies, was marked 0.17% higher in early European trading, extending its gains for seventh consecutive session to a five-week high of 96.67.

Benchmark 10-year Treasury note yield, meanwhile, slipped 1 basis point to 2.64% and similarly-dated German bunds, a proxy for risk-free borrowing rates in Europe, traded at just 0.105%, the lowest since November 2016.

The pound was marked modestly lower at 1.2940 against the U.S. dollar following a meeting in Brussels between European Commission President Jean-Claude Junkcer and U.K. Prime Minister Theresa May yesterday that failed to break the deadlock on Breixt talks that hinges on the Irish border issue, although the pair pledged to meet again before the end of the month.

The euro was pegged at 1.1325 in early London trading, down 0.13% on the session to extend its one-month decline to around 1.9% after the European Commission said Thursday it sees broader Eurozone growth slowing to 1.3% in 2019, down from a prior forecast of 1.9%. Currency area inflation, the Commission said, will ease to 1.4%, well shy of the European Central Bank's 'just below 2%' price stability target.

The Bank of England followed suit, cutting its 2019 forecast to 1.2% as it held rates steady at 0.75% amid the conflicting dynamics of slowing domestic and global growth but rising wage and inflation pressures.

In the U.S., with more than three quarters of the S&P 500 reporting December quarter earnings and near-term forecasts, first quarter earnings growth is currently pegged at just 0.3%, suggesting the prospect of so-called earnings recession -- where profits shrink for two consecutive quarters -- could now be in the market's cross-hairs.