Dollar falls as selling pressure builds on multiple fronts

The dollar extended its fall to hit fresh lows against a range of currencies on Tuesday, after a triple blow of retreating yields, soft US economic data and a dip in safe-haven demand exerted broad selling pressure.

The yuan firmed to 6.9246 per dollar, hitting a level unseen since March 9, despite the Trump administration flagging a further tightening of restrictions against Chinese tech gear maker Huawei.

Against the Swiss franc, the dollar fell more than 0.1% to fresh 5-1/2 year low of 0.9049.

"The background factor for the moves we're seeing today is the overall weakness of the dollar," said Shinichiro Kadota, senior strategist at Barclays. "And the Swiss franc strengthened because of a euro-led decline in the U.S. dollar since July." 

The greenback is also poised to re-test multi-month or multi-year troughs against the euro, pound and Aussie made earlier in the month. 

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The euro last sat at $1.1891, just below a recent two-year high of $1.1916.

The Aussie rose 0.12% to $0.7225, near an 18-month top of $0.7242 hit on Aug. 7, as the Reserve Bank of Australia reaffirmed the outlook of steady policy.

The Aussie's gains were capped by news China had begun an anti-dumping investigation into imports of drink from Australia.

Investors have been relieved by a delay in the review of the US-China trade deal this week, which has left the agreement standing and reinforced a belief the trade relationship can hold even amidst conflict on multiple other fronts.

A fresh rally in tech stocks added to the positive mood, and together with a pullback in US yields and a weak reading in a US manufacturing survey has many traders sticking to their bearish convictions on the dollar.

Against a basket of currencies the dollar sat at an eight-session low of 92.634.

Reuters