Greenback Softer Amid Political Unrest


NEW YORK (TheStreet) -- Political strife in the Middle East and North Africa weighed on the dollar Thursday morning.

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"The dollar is slightly weaker against the yen and the Swiss franc as tension in the Middle East and North Africa is helping boost safe haven assets," Marc Chandler, global head of currency strategy at Brown Brothers Harriman said in a morning note.

Inspired by the ouster of long-reigning presidents in Egypt and Tunisia, unrest has spread across the Middle East and North Africa, as the masses take to the streets amid rising food and oil costs.

The Swiss Franc and gold were both gaining ground on their safe-haven attributes.

The U.S. dollar was slipping 1% against the Swiss franc at CHF0.9496.

The spot gold price was up 0.4% to $1,381 an ounce.

Meanwhile, the UK pound regained strength against the U.S. dollar, rising 0.2% at $1.613.

The UK pound slipped against the greenback Wednesday morning as Bank of England governor Mervyn King indicated that the central bank may not be hiking interest rates just yet.

However, the pound regained ground the following morning as Andrew Sentence, a crucial and hawkish member of the Bank of England's Monetary Policy Committee, on Thursday pushed for higher interest rates and a stronger pound -- citing rising inflation in the UK.

The greenback was also slipping against the Canadian dollar, down 0.1% to C$0.9835.

"A stronger U.S. economy along with increases in commodity prices could force the Canadian dollar higher," Chris Gaffney, vice president of EverBank World Markets noted in a morning report.

"But I still worry that the Canadians don't really want their currency appreciating too far past parity with the U.S. dollar, so we could see them trying to keep a lid on any major moves higher."

CurrencyShares Swiss Franc Trust ( FXF) rose 1% to $104.41 during morning trading Thursday, while the CurrencyShares Canadian Dollar Trust ( FXC) inched up 0.2% to $101.11.

The PowerShares DB US Dollar Index Bullish Fund ( UUP) was down 0.2% to $22.42 and PowerShares DB US Dollar Index Bearish Fund ( UDN) was up 0.3% to $27.43.

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-- Written by Andrea Tse in New York.

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