TOKYO, June 29 Reuters The dollar edged higher on Wednesday, keeping its index against major peers nestled below a twodecade high struck two weeks ago, with investors seeking safety in U.S. assets as stocks declined globally due to the mounting risk of a recession.

The dollar index, which measures the greenback against six counterparts, ticked up 0.067 to 104.54, spurred mainly by weakness in the euro overnight. The twodecade high of 105.79 was struck on June 15.

The greenback was firm despite U.S. 10year Treasury yields retreating by nearly one percentage point in Tokyo trading, as bonds remained in favour with investors due to the souring risk sentiment.

Asian equities slid, following heavy Wall Street losses overnight after a steep drop in U.S. consumer confidence stoked worries about an economic slowdown at a time when the U.S. Federal Reserve is rushing to raise interest rates to bring inflation under control.

The euro slipped 0.14 to 1.0506 after dipping as low as1.05025 on Tuesday, when European Central Bank ECB chief Christine Lagarde offered no fresh insight on the path for European interest rates at the ECB39;s annual forum. 

The ECB is widely expected to follow its global peers by raising interest rates in July for the first time in a decade to try to cool accelerating inflation, though economists are divided on the magnitude of any hike.

Lagarde and Fed Chair Jerome Powell will speak on a panel at the forum later on Wednesday.

Westpac strategists said…