FOREX-Dollar firms, euro hurt after ECB signals further easing

* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

By Eimi Yamamitsu
TOKYO, Oct 30 (Reuters) - The dollar firmed on Friday and
the euro wallowed near a four-week low against the greenback
after the European Central Bank signalled further monetary
easing by the end of the year.
The euro's overnight decline helped lift the U.S. dollar
near four-week high against a basket of currencies.
The ECB kept interest rates steady on Thursday but committed
to contain the growing fallout from a second wave of coronavirus
infections, saying it would hone its response by its December
meeting, as widely expected by the market. "We agreed, all of us, that it was necessary to take action
and therefore to recalibrate our instruments at our next
Governing Council meeting," ECB President Christine Lagarde told
a news conference.
"The economy in euro zone is deteriorating at a faster pace
than expected, and some view that monetary easing won't be
enough to lift the euro zone, or that it will be too late (in
December). Such reactions probably pressured the euro to fall,"
said Masafumi Yamamoto, chief currency strategist at Mizuho
Securities, noting that it will be difficult for the single
currency to rise in the immediate future.
The euro was little changed at $1.1676 EUR=EBS in Asia,
taking a pause after hitting a four-week low of $1.1650 in U.S.
trade overnight.
Against the yen, the common currency slightly eased at
122.08 yen EURJPY=EBS .
Data on Thursday showed the U.S. economy grew at a record
pace for the third quarter and an improving trend in jobless
claims, while scars from the coronavirus recession still
lingered. U.S. gross domestic product rebounded at a 33.1% annualised
rate last quarter, according to an advance estimate on Thursday,
the fastest pace since the government started keeping records in
1947.
Separately, a report showed 751,000 people in the United
States filed for state unemployment benefits in the week ended
Oct. 24, compared with 791,000 the previous period.
The dollar index rose to a four-week high overnight due to
the euro's decline and U.S. data. It stayed near Thursday's
level at 93.916 =USD and was on track to post its second
monthly gains.
Still, uncertainty surrounding Tuesday's U.S. presidential
election and coronavirus fears continue to loom over market.
Global coronavirus cases rose by over 500,000 for the first
time as France and Germany falls back into coronavirus lockdowns
next week. The United States also faces with rising cases in 47
states, and patients were overwhelming hospitals across the
country. Data due on Friday include euro zone's third-quarter gross
domestic product and October inflation, while the U.S. awaits
September personal consumption and expenditures as well as
Chicago PMI.
The greenback was little changed against the Japanese yen at
104.55 yen JPY=EBS , having rallied from a five-week trough
overnight as it benefited from a rebound in U.S. treasury yields
and broad dollar buying.
Sterling changed hands at 1.2927 GBP=D3 , undermined by a
lack of Brexit-related headlines as London and the European
Union have just two months to reach a post-Brexit trade
agreement.
The Aussie AUD=D3 changed hands at $0.7031, slightly above
a three-month low of $0.7002 marked overnight.
Across the Tasman Sea, the kiwi NZD=D3 held steady, last
fetching 0.6623 per dollar.