Mubasher: US dollar stood earlier on Monday near a one-week high, driven by concerns over global trade after the US and Canada failed to reach a common ground in their trade talks.

In early London trading, the US dollar index, a tracker of the currency against a basket of six of its major peers, edged higher to 95.22, the highest level since 27 August.

By 9:52 am GMT, the dollar index ticked up 0.01% to 95.1530.

The US currency gained almost 7% since mid-April when trade tensions first erupted.

US President Donald Trump stated on Saturday that there was no need for having Canada in the North American Free Trade Agreement (NAFTA), warning Congress not to interfere with the trade discussions, or else he would scrap the entire trilateral pact.

The news drove investors to buy the US dollar in large numbers against the sterling pound (GBP) and the Canadian dollar (CAD). As the chief reserve for value, the greenback is the primary beneficiary of trade conflict concerns.

The pound fell 0.4% to $1.29, while it weakened against the euro (EUR) to GBP 89.80.

By 10:15 am GMT, the GBP/USD dropped 0.69% to $1.2871, while the EUR/GBP pair rose 0.68% to GBP 0.9017.

The single currency edged down against the US dollar after Fitch Ratings on Friday held its credit rating for Italy at “BBB,” whereas it lowered its outlook for the European country.

However, by 10:19 am GMT, the EUR/USD pair went up 0.03% after data on the Eurozone manufacturing activity in August was released earlier.

The US dollar gains were offset as safe-haven currencies such as the Swiss franc (CHF) and Japanese yen (JPY) found support against higher-yield peers.

At 10:27 am GMT, the Swiss franc rose against the US dollar 0.12% to CHF 0.9701, while the Japanese yen went up 0.04% to JPY 111.0700.

“Trade tensions are broadly supporting the dollar, but the market is hardly very conducive of risk,” London-based ING foreign exchange (FX) strategist Viraj Patel told Thomson Reuters.