The yen and the Swiss franc rose, while the euro fell on Tuesday after explosions rocked Brussels and spurred inflows into traditional safe-haven currencies and assets.

European shares were in the red, while airline stocks fell sharply, souring overall sentiment towards high-yielding and riskier assets after two explosions tore through Brussels airport, killing 13 people in what Belgian public broadcaster VRT called a suicide attack.

“The news is having impact on sentiment,” said Yujiro Goto, currency strategist at Nomura. “Safe-haven currencies are being supported on the headlines.”

The yen rose to a 12-day high against the euro, rising almost 1 per cent at one point. The yen also rose to a day's high of 111.38 yen per dollar, having traded lower before the start of the European trading session.

The Swiss franc climbed to a two-week high of 1.0879 franc per euro. Both currencies are much sought after during times of turmoil in financial markets and uncertainty in the global economy.

Against the dollar, the euro was lower at $1.12, after having recoiled from Thursday's one-month high of $1.1342, with investors ignoring the German IFO survey and euro zone purchasing managers' surveys on the back of the explosions in Brussels.

The euro's losses saw the dollar index extend its rebound from a five-month low as two Federal Reserve officials supported the an interest rate hike in coming months.

The dollar index last traded at 95.643, pulling further away from a five-month trough of 94.578 set on Friday.

Atlanta Fed President Dennis Lockhart said there was sufficient economic momentum to justify a further rate hike "possibly as early as the meeting scheduled for end of April".

San Francisco Federal Reserve Bank President John Williams told Market News International that April or June would be "potential times for a rate hike".

Their comments came a week after the Fed kept rates unchanged and cut in half the number of projected hikes to a mere two this year - a move seen by many as dovish.

While dollar bulls were heartened by the latest comments, the reaction in fed funds futures was muted as some investors held back before speeches by more dovish Fed officials including Chicago Fed President Charles Evans.

“There are people out there who had thought the dollar could fall below 110 yen and are now being forced to cover their short positions,” said Masatoshi Omata, senior client manager of market trading at Resona Bank.

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