The dollar pushed higher today (August 12th) as the euro’s slide continued and oil prices retreated further.
Anxieties about a slowing global economy today pushed the dollar to a six-month high against the euro and other major currencies, encouraging the sale of commodities such as oil and gold.
While one major index, which follows the dollar against a basket of other major currencies, went up to 76.616, the euro and pound tumbled to $1.4877 and $1.90 respectively.
James Hughes, a currency analyst with CMC Markets, said: "Although softer crude prices are undoubtedly playing a significant role in the supporting the dollar just now, it does remain open to debate as to how much longer oil traders can hold their nerve in light of the deteriorating situation in Georgia."
This suggests that if the fighting in South Ossetia were to escalate, a risk of damage to the Baku-Tbilisi-Ceyhan oil pipeline could cause the dollar to fall.
The euro has been falling since the European Central Bank opted to leave interest rates unchanged on Thursday 7th August.