The dollar held near a two-week high on Friday, as demand for safe-haven assets rose on uncertainties about the path of US-China trade negotiations and broader worries about slowing global growth. Such concerns were brought to the fore on Thursday after the European Commission sharply cut its forecasts for euro zone economic growth this year and next on expectations the bloc's largest countries will be held back by global trade tensions and domestic challenges.

Investors' anxieties about the global economy were also compounded by comments from US President Donald Trump, who said he did not plan to meet with Chinese President Xi Jinping before a March 1 deadline to achieve a trade deal.

"The dollar is being supported by worries over global growth and external factors," said Sim Moh Siong, currency strategist at Bank of Singapore. The dollar index, a gauge of its value versus six major peers was up by around 0.1 percent at 96.59, sitting just shy of its two-week high.

The index has gained for six straight sessions in a row. This was mainly due to a weaker euro, which has around 58 percent weightage in the index, and came despite the Federal Reserve's dovish shift on interest rates last week. The Aussie dollar fell 0.3 percent to $0.7076 in Asian trade as the Reserve Bank of Australia cut its growth forecasts.

The Aussie has shed 2.4 percent of its value so far this week after the central bank signalled a shift from its long-standing tightening bias earlier this week. But some analysts see limited downside for the Aussie. "Aussie dollar should find technical support at $0.70 versus the dollar..quite a lot of bad news is priced in already and rising iron-ore prices should also be supportive," Bank of Singapore's Sim added.

The euro was marginally lower at $1.1338, on track to post its fifth straight day of losses. The single currency has been stumbling due to weaker-than-expected growth data out of the euro zone and expectations that the European Central Bank will keep monetary policy accommodative this year. The yen was steady at 109.74. Analysts think Japanese demand for foreign bonds has supported dollar/yen. The greenback gained around 0.8 percent versus the yen over the last week.

Sterling was marginally lower at $1.2950. The greenback was 0.1 percent higher versus the Canadian dollar at C$1.3319, on track to post its largest percentage gain since mid-June. Canada is a major producer of commodities, including oil, and the loonie has been under pressure due to falling energy prices.

Copyright Reuters, 2019