LONDON, Aug 18: The dollar got a boost Thursday from a surge in demand after US traders came into the market, with hedge funds among those said to be buying. The euro fell to 1.2176 dollars in late European trading from 1.2271 late Wednesday in New York. The dollar rose to 110.53 yen from 109.92 Wednesday.

The dollar’s late rise pushed the euro convincingly under the 1.22-dollar level and the pound under 1.80 dollars.

“It’s hard to put the finger on it but some hedge funds are buying,” said Paul Bednarczyk at 4CAST.

Indeed, there was no apparent trigger for the dollar’s sudden rise in late afternoon trading. The currency has been drifting higher over the past few days but the gains accelerated Thursday.

At one point, the dollar edged up quickly against the yen but things changed and the euro then appeared to absorb the selling. Some of the movements may also have been due to mergers and acquisition-type flows, said Bednarczyk.

Additionally, the thin summer trade may also have exaggerated moves, he added.

Daniel Katzive at UBS said that market sentiment so far this week seemed to reflect a bit more skepticism on the outlook for global growth.

Players also appear to be behaving in a “more risk-averse” way, he added.

Notably, the dollar’s gains have been most against currencies sensitive to sentiment on global growth, such as the Australian dollar and the Japanese yen.—AFP