Dollar higher

LONDON: The dollar edged higher on Monday, closing in on last week´s one-year high, as investors ramped up bets that escalating trade tensions between the U.S. and its trade partners will hurt the world´s biggest economy the least for now.

Tension is growing ahead of a July 6 deadline when Washington is due to impose $34 billion of tariffs on Chinese exports, with two surveys of Chinese manufacturing out in the last few days showed a softening in activity, partly due to softness in exports.

"The dollar has begun to benefit from increased trade tensions as the relative economic impact of tariff measures comes into focus, with the U.S. economy better insulated than the rest of the G10," BNP Paribas strategists said.

Rising trade tensions have hit stock markets from Germany to South Korea and prompted investors to hedge their exposure to relatively high-yielding currencies such as the Australian dollar and the Chinese currency.

Taking note of the rising dollar, BNP Paribas trimmed its end-year forecasts for the euro and sterling for end 2018.Latest positioning data remains broadly supportive for the dollar and is an extension of themes seen in currency markets in recent days.