FOREX--Dollar firm amid optimism over economic reopening; Norway's crown jumps

* Pound near seven-week low on Brexit worries, negative
rates
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

By Julien Ponthus
LONDON, May 18 (Reuters) - The dollar held firm on Monday as
optimism about a reopening of economies stifled by the
coronavirus pandemic kindled cautious risk appetite, with a jump
in oil prices lifting commodity currencies such as the Norwegian
krone.
The gradual easing of lockdowns has raised hope across
global markets despite signs of fresh trade tensions between the
United States and China, though traders were wary of taking big
bets before more data this week.
"Markets are quietly risk-on overnight," said Adam Cole,
chief currency strategist at RBC Capital Markets.
The dollar index =USD , which posted gains of about 0.6%
last week, inched up 0.02% after drifting slightly in negative
territory in the early hours of trading in Europe.
U.S. Federal Reserve Chairman Jerome Powell's willingness to
print more dollars and extend the monetary stimulus further to
fight the coronavirus economic crisis was welcomed by investors.

Bets against the U.S. dollar shrank to the smallest position
in seven weeks in the latest week, according to calculations by
Reuters and U.S. Commodity Futures Trading Commission data
released on Friday.
The Norwegian krone was lifted by rising oil prices,
supported by output cuts and signs of a recovery in demand.
"The surge in oil prices will also provide a selective
opportunity to sell the U.S. dollar against oil-sensitive major
currencies," wrote Stephen Innes, chief global markets
strategist at AxiCorp.
Against the dollar, the krone NOK=D3 jumped 0.7% to
10.1770. Other commodity currencies also rose and gold gained
more than 1.2% to its highest in over seven years.
Gains in stocks also lifted other major currencies such as
the Australian dollar, which was up AUD=D3 half a percent at
$0.6446. The euro EUR=D3 fell 0.1% to $1.0806.
Against the yen JPY= , the U.S. currency lost about 0.2%
at 107.20 per dollar after data showed Japan slipped into
recession for the first time since 2015. Policymakers are
bracing for the nation's worst postwar slump.
Investors were also looking to Purchasing Managers' Index
surveys due across major economies later this week for the next
insight into the outlook.
The pound took back some ground lost earlier against the
euro and was trading at 89.14 pence EURGBP=D3 after a
week-long deadlock over a post-Brexit trade deal with the
European Union.
Money markets also ramped up expectations of negative
interest rates in the United Kingdom for the first time ever as
policymakers debated further steps to support the struggling
British economy. The Bank of England's chief economist, Andy Haldane, did not
rule out such a move in an interview with the Telegraph
newspaper published on Saturday.