FOREX-Dollar rises on safe-haven demand as oil-linked currencies fall

* Oil price drop sinks oil-linked currencies
* Dollar index hits 2-week high before paring gains

(Updates to U.S. afternoon)
By Saqib Iqbal Ahmed
NEW YORK, April 21 (Reuters) - The U.S. dollar rose to a
two-week high against a basket of currencies on Tuesday as
investors fled riskier assets amid a slump in oil prices that
sapped demand
The U.S. Dollar Currency Index =USD , which measures the
greenback's strength against six other major currencies, was
0.24% higher at 100.19. The index hit a two-week high of 100.48
earlier in the session.
U.S. crude oil futures moved into negative territory for the
first time on Monday, as a sharp fall in global fuel use due to
the coronavirus pandemic creates a supply glut and a shortage of
storage capacity. O/R
Factory closures and travel curbs enforced to slow the pace
of new coronavirus infections have triggered a collapse in oil
prices. This is drawing money from commodity currencies and
other risk assets to the safety of dollar-denominated assets.
"It's definitely a risk-off day so the dollar is benefiting
from that now," said Minh Trang, senior FX trader at Silicon
Valley Bank in Santa Clara, California.
Oil-linked currencies like the Norwegian crown and the
Canadian dollar were Tuesday's worst-performing currencies,
along with the Swedish crown, which is very sensitive to global
economic stability.
"Yesterday's oil rout spooked investors, and while some
economies are starting to reopen from lockdowns, the road back
to normalcy is clearly going to be a long one," Jonathan
Coughtrey, managing director at Action Economics, said in a
note.
The greenback rose to a near one-month high against the
Norwegian crown NOK= before easing to trade up 1.68%. Against
the Canadian dollar CAD= , the U.S. dollar was up 0.21%. The
dollar was 0.81% higher against the Swedish crown. SEK=
"Even when you turn the economy back on it will take a while
for demand to soak up the oil supply," said Trang.
"Until this gets resolved you shouldn't be surprised to see
additional weakness," he said referring to the oil-linked
currencies.
The euro was 0.05% lower against the dollar despite a survey
released on Tuesday that showed the mood among German investors
improved in April as concerns about the impact of the pandemic
on Europe's largest economy seemed to have eased. Investors are watching for the outcome of a European Union
summit later this week on how the EU will try to handle the hit
to the economy from the pandemic.
The dollar's strength pushed the British pound to a two-week
low, as investors offloaded British assets to raise cash to
cover losses resulting from the oil price collapse, according to
Kenneth Broux, head of corporate research at Societe Generale.
Sterling was last down 1.17% against the dollar.

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
Norwegian crown worst performing currency IMAGE https://reut.rs/2VOAWPm
^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>