The US dollar continues to trade bullish into Thursday, amid a risk-off mood in markets caused by the ongoing spike in coronavirus cases across the world and countries announcing more restrictions to curb the pandemic. At the time of writing, the US dollar index DXY is trading around 90.75.

The latest wave of the pandemic has prompted England to announce tighter travel curbs while China has also cautioned citizens against traveling during the upcoming Lunar New Year holidays – the busiest travel season of the year. The renewed restrictions are supporting the safe haven appeal of the US dollar, driving other riskier peers to nurse losses.

The Euro slipped against the greenback on the back of comments from an ECB member suggesting possible intervention by the central bank in the form of rate cuts to curb its recent strengthening. Meanwhile, commodity currencies AUD and NZD have also weakened as traders turn more cautious and the risk appetite wanes.

The US dollar also enjoys support from a bearish run in global equity markets on the back of rising concerns about corporate earnings and possible delay in the rollout of COVID-19 vaccines. During the previous session, US stock markets fell by over 1% – the steepest decline seen in three months, further boosting demand for the dollar as a safe haven.