The safe-haven dollar, yen and Swiss franc gained on Thursday as U.S. stocks tumbled amid diminished expectations that the global economy would recover swiftly from the coronavirus pandemic.

The yen rose to a one-month high against the dollar, while the Swiss franc climbed to a fresh three-month peak.

The dollar index, though, gained for the day, as investors sold currencies associated with risk-taking such as the euro, sterling and the Australian dollar.

“Today, the animal spirits aren’t so strong,” said Marc Chandler, Chief Market Strategist at Bannockburn Global Forex in New York. “One trade is rippling through the markets: taking profits on equities, beating up on emerging markets, unwinding gains in these leading currencies and flocking to the safety of the debt markets.”

Currency traders took their cue from the U.S. stock market, where the S&P 500 was on track for its worst day since March.

“This historic gain in equities is getting a reality check. There are some concerns about re-infections, but my thought is that today is not so much different from the beginning of the week,” said John Doyle, vice president of trading and dealing at Tempus Inc. in Washington. “But perhaps because of how fast and how hard equities have gone up and the dollar has gone down, traders are looking for an excuse to take profits and take them off their highs and the dollar off their lows,” he added.

Since late May, with better-than-expected economic data and as economies and U.S. states started to re-open, the dollar has fallen 3.5% against the currency basket.

Demand for safe-haven currencies increased after the Federal Reserve issued a dire outlook on Wednesday. Following its two-day meeting, the Fed signaled it plans years of extraordinary support for the U.S. economy, which policymakers project will shrink by 6.5% in 2020, with the unemployment rate at 9.3%.

Investors were also worried about new coronavirus infections as the world gradually reopened following shutdowns aimed at curbing the spread of the disease.

In the United States, new infections are rising slightly after five weeks of declines, according to a Reuters analysis. Part of the increase is due to more testing, which hit a record high on June 5 of 545,690 tests in a single day but has since fallen.

In afternoon trading, the dollar fell 0.3% against the yen to 106.84 yen, after earlier dropping to a one-month trough.
The dollar also slid to a three-month low versus the Swiss franc of 0.9399 franc, and was last down 0.2% at 0.9424 franc.

Against a basket of currencies,, however, the dollar rose 0.5% to 96.681, led by gains versus the euro. The euro dropped 0.5% to $1.1314.

High-beta currencies heavily geared toward global growth, such as the Australian dollar and the Norwegian crown, led losers, falling more than 1% against the dollar.