The dollar rose to its highest level in over two months during early Asian trading today, amid escalating risks related to the U.S. government shutdown, sparking new investor concerns and boosting demand for safe-haven assets.

The dollar index, which measures the U.S. currency’s performance against six currencies, increased by 0.3 percent to 98.91, its highest level since August 5, following U.S. President Donald Trump’s threat to carry out mass federal employee layoffs during the shutdown crisis.

Westpac analysts wrote in a research report: “With no resolution in sight for the government shutdown, market sentiment has deteriorated.”

The New Zealand dollar fell by up to one percent to a low of 0.5739 dollars after the Reserve Bank of New Zealand surprised the market by cutting interest rates by 50 basis points, a larger cut than expected, and indicated further easing ahead following recent economic data deterioration.

Joseph Capurso, head of foreign exchange, international and economic geography research at Commonwealth Bank of Australia, said: “The market was only expecting a 30 percent chance of a 50 basis point cut from the Reserve Bank of New Zealand today.”

He added, “It was inevitable that the New Zealand dollar would fall.”

The Australian dollar declined 0.4 percent in the latest trades to 0.65595 dollars.

The dollar traded at 152.535 yen, up 0.4 percent from late yesterday levels, hovering around its strongest level since February, as investors assess the impact of economic policies by Sanae Takaichi, who won the leadership of the ruling party and is set to become Japan’s new prime minister.

Investors wonder whether the victory of the late former Prime Minister Shinzo Abe’s protégé signals similar stimulus policies that could boost stocks but weaken the yen.

The euro stood at 1.1618 dollars, down 0.3 percent during Asian trading hours, while the British pound was at 1.3395 dollars, down 0.2 percent.

The offshore yuan fell 0.1 percent from the previous session to 7.1506 yuan per dollar.