By Tom Holian

Dollar has gained against sterling and the euro this afternoon, erasing the early losses following UK stocks reversing course to fall to multi-year lows, prompting investors to seek the perceived safety of U.S. dollar assets.

“Risk aversion is providing support to the Dollar, in particular against the Euro,” said Adam Boyton, a senior currency strategist in New York at Deutsche Bank AG, the world’s largest foreign exchange trader. Risk aversion is where investors look to draw their money away from unstable or risky currencies and put it somewhere they believe to be safe, thought to be The Dollar at the moment.

This is strongly due to the performance of Euro-zone and British economies, which are weakening. With Interest Rate decisions out on Thursday the volatility in these areas will only strengthen leading the US becoming what is known as a ‘safe haven’.