Investing.com - The U.S dollar is on track to snap a two-week losing streak Friday as safe-haven buying set in on expectations the U.S.-Sino trade war could turn ugly in the coming weeks.
The U.S. dollar index, which measures the greenback against a trade-weighted basket of six major currencies, rose by 0.14% to 96.42.
The dollar saw fresh support on fears the U.S. and China are set to resume, or worst yet escalate their trade war in the coming weeks as Washington reportedly will not back away from plans to ramp up tariffs on China in the absence of a trade deal by March 1.
The U.S. has slapped tariffs on $250 billion worth of Chinese goods, about half the value of U.S. imports from the country. China has hit back with tariffs on $110 billion worth of American exports.
Wall Street also drummed up support for the dollar pointing out that it will take more than a "dovish" Federal Reserve to keep a lid on the greenback.
"Further dollar downside most likely requires a combination of slower U.S. growth and better non-U.S. growth -- a dovish Fed may not be quite enough," Goldman Goldman Sachs said.
Elsewhere, a weaker euro and pound also lent support to the dollar.
EUR/USD fell 0.13% to $1.1325 and GBP/USD fell 0.15% to $1.2934.
USD/JPY rose 0.15% to Y109.84
Analysts on Wall Street said the strong economic data from Canada could nudge the Bank of Canada toward a rate hike, but conceded a weaker backdrop for the energy sector would likely weigh on growth.
"The data should help support the Bank of Canada's bias towards higher rates, although the weakness across the energy sector and Alberta provide evidence of the headwinds to the economy in first quarter," TD Securities said.