The dollar index rose yesterday to exceed 96.00 this morning, posting moderate gains. The Dollar continues to rise following hawkish comments from Fed Governor Brainard on Friday.

The decline in equities due to heightened tensions between Russia and Ukraine boosted demand for cash for the greenback. Its rise was limited by falling T-note yields, which weakened dollar interest rate differentials. The euro was down against safe-haven currencies (yen, Swiss franc and dollar) on heightened tensions between Russia and Ukraine, after Vladimir Putin officially recognized the breakaway regions taking a step towards military escalation.

USD/JPY and EUR/JPY hit two-week highs today as rising tensions between Russia and Ukraine weighed on stocks and boosted demand for the yen as a safe haven . This is also the case for the Swiss franc, which remains in high demand after Putin's decision (See EUR/CHF and USD/CHF article elsewhere). The meeting between the heads of Russian and American diplomacy scheduled for Thursday remains relevant to avoid an invasion of Ukraine.