(Updates with midday U.S. trading, adds NEW YORK dateline, byline)
The euro fell against major currencies and the U.S. dollar rallied on Friday as worries increased over the impact of the escalating Ukraine-Russia conflict, especially on Europe's growth outlook.
The euro fell below $1.10 against the dollar for the first time in almost two years, and was last down 1.4% at $1.0916 and on track for its biggest daily percentage decline since March 2020 EUR=USB . The European single currency also hit a fresh seven-year low versus the safe-haven Swiss franc.
Russian invasion forces seized Europe's biggest nuclear power plant on Friday. A blaze in a training building was extinguished and officials said the facility was now safe, while combat raged elsewhere in Ukraine in the second week of the assault launched by Russian President Vladimir Putin.
Against the Swiss franc, the euro was last down 1.3% at 1.0020 EURCHF= . The euro also sank against sterling, hitting its lowest level since June 2016 EURGBP= . Strategists worry that surging energy and gas prices will hit Europe's economic growth prospects.
Investors flocked to the U.S. dollar and other safe-haven currencies. The U.S. dollar index =USD initially pared gains but then rallied further following data Friday that showed U.S. job growth surged in February. The report raised optimism that the economy could withstand tighter monetary policy.
The index was last up 1%, trading around its highest since May 2020, while the dollar was down 0.6% against the Japanese yen JPY=EBS
"The most compelling story here is the flight to safety, which we've seen coming in ebbs and flows. It picked up overnight with the fire" in Ukraine, said Amo Sahota, director at Klarity FX in San Francisco. "That created a pop up in U.S. dollar across the board.
"The big losses have really been focused on European currencies in particular. Euro/dollar is going to be the big headline grabber," he said. "Economists in general are going to be revising down a lot of their forecasts."
Also supporting the dollar, investors expect the U.S. Federal Reserve to raise interest rates at its March 15-16 meeting for the first time since the coronavirus pandemic.
In addition, the Czech National Bank said on Friday it was intervening in the market to stem the depreciation of the crown CZK= . Poland's central bank intervened this week, but the zloty EURPLN= still hit a 13-year low against the euro, while Hungary delivered its most aggressive rate hike since 2008 as the forint also tumbled to record lows.
The rouble traded near record lows against the dollar and euro in volatile Moscow trade RUBUTSTN=MCX EURRUBTN=MCX , after Russia's credit rating was cut deeper into junk by S&P.
======================================================== Currency bid prices at 11:46AM (1646 GMT)Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Dollar index =USD 98.6330 97.7200 +0.95% 3.105% +98.9250 +97.7200 Euro/Dollar EUR=EBS $1.0916 $1.1066 -1.36% -3.98% +$1.1068 +$1.0886 Dollar/Yen JPY=EBS 114.7250 115.4400 -0.61% -0.33% +115.5500 +114.6800 Euro/Yen EURJPY= 125.22 127.76 -1.99% -3.91% +127.8100 +125.1500 Dollar/Swiss CHF=EBS 0.9180 0.9171 +0.12% +0.66% +0.9210 +0.9166 Sterling/Dollar GBP=D3 $1.3211 $1.3345 -1.00% -2.31% +$1.3355 +$1.3202 Dollar/Canadian CAD=D3 1.2764 1.2683 +0.64% +0.95% +1.2792 +1.2670 Aussie/Dollar AUD=D3 $0.7355 $0.7329 +0.40% +1.22% +$0.7375 +$0.7301 Euro/Swiss EURCHF= 1.0020 1.0151 -1.29% -3.37% +1.0157 +1.0020 Euro/Sterling EURGBP= 0.8260 0.8284 -0.29% -1.67% +0.8295 +0.8232 NZ NZD=D3 $0.6841 $0.6800 +0.59% -0.07% +$0.6843 +$0.6768 Dollar/DollarDollar/Norway NOK=D3 8.9790 8.9215 +0.77% +2.05% +9.0505 +8.9040 Euro/Norway EURNOK= 9.8067 9.8583 -0.52% -2.06% +9.8838 +9.7968 Dollar/Sweden SEK= 9.8756 9.7338 +0.02% +9.51% +9.9621 +9.7368 Euro/Sweden EURSEK= 10.7873 10.7849 +0.02% +5.41% +10.8519 +10.7627 <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ World FX rates https://tmsnrt.rs/2RBWI5EEuro vs Swiss franc https://tmsnrt.rs/3hF80os
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