The safehaven U.S. dollar approached a fourmonth high on Wednesday as concerns over a third COVID19 wave in Europe, potential U.S. tax hikes and escalating tensions between the West and China sapped risk appetite.

The yen also strengthened and U.S. Treasuries were bid while Wall Street stocks and crude oil tumbled as investors weighed the outlook for global growth.

The dollar index rose to a twoweek high at 92.436 in the Asian session, approaching a fourmonth top of 92.506 hit earlier this month.

The gauge looks determined to test the top end of a new, higher 9193 range we think will form in coming weeks, Westpac strategists wrote in a client note.

Extended European lockdowns have sapped confidence in a synchronised global rebound; meanwhile, the U.S. will have an impressive rebound in coming months amid a strong vaccine rollout, stimulus payments and economic reopenings, they said.

The euro edged toward a fourmonth trough below 1.18355 trading as low as 1.18360 after Germany extended a lockdown and urged its citizens to stay at home during the Easter holiday.

Worries over the pace of the pandemic recovery were heightened after a U.S. health agency said the AstraZeneca Plc vaccine may have included outdated information in its data.

The flight to safety received an additional nudge when Treasury Secretary Janet Yellen told lawmakers that future tax hikes will be needed to pay for infrastructure projects and other public investments.

Yellen was testifying to the…