* Dollar stabilizes after gaining on vaccine news
* Yen trades near Monday levels
* Swiss franc recovers some losses
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
(Updates prices, adds commentary)
By David Henry
NEW YORK, Nov 10 (Reuters) - The dollar was steady on Tuesday and the yen stayed near three-weeks
lows, as investors remained optimistic about progress toward a COVID-19 vaccine and the currency markets
digested Monday's big moves.
U.S. drugmaker Pfizer Inc PFE.N and German partner BioNTech SE BNTX.O said on Monday a large-scale
clinical trial showed their vaccine was more than 90% effective in preventing COVID-19 - news which drove
renewed appetite for risk that lifted global markets. The dollar's rise on Monday of 0.5%, analysts said, was caused by investors quitting long positions in
other major safe-haven currencies such as the Japanese yen and the Swiss franc. The dollar was flat against a basket of major currencies, near its previous session's highs, as market
participants declined to push it further in light of uncertainty about how or when a vaccine could be
rolled out.
U.S. Treasury yields held their Monday increases, and the spread between two-year and 10-year notes
widened slightly, in choppy trading. Major U.S. and European stock indexes at midday Eastern
Time were also holding steady with most of their gains from Monday. "Today is a little bit of a cool-off from what we've seen in this past couple of days," said Minh
Trang, senior FX trader at Silicon Valley Bank. "I don't mind a little bit of a breather. November has
been very, very interesting."
Neil Jones, head of FX sales for financial institutions at Mizuho, said he expected the risk-on moves
to hold.
"We need more clarity in terms of the distribution, quantities, timeline, and to whom," Jones said.
"On balance, that optimism will remain for now."
The dollar had lost around 1.4% this month until Democrat Joe Biden's victory in the U.S. presidential
election became apparent over the weekend. The Japanese yen, which had its biggest one-day fall since March after the vaccine announcement, was
little changed Tuesday at 105.28 JPY=D3 yen to the dollar. The yen had initially clawed back some of its
losses from the day before.
The Swiss franc CHF=EBS gained marginally, with the dollar rising 0.1% to 0.914 franc after Monday's
1.5% gain.
"Following a euphoric market reaction such as that, the question that now arises is whether it was
justified or possibly exaggerated," wrote Commerzbank FX and EM analyst You-Na Park-Heger in a note to
clients.
Possible catalysts for future changes in exchange rates include new talks in Washington on another
round of government spending to stimulate the economy, said Trang of Silicon Valley Bank.
"That's the next topic that most people will be focusing on in the next six months," he said.
Senate Majority Leader Mitch McConnell said on Tuesday afternoon that he did not see a need for a
giant coronavirus relief bill. "It seems to me that snag that hung us up for months is still there," the
Republican told reporters. Euro-dollar was broadly flat at $1.1823. In the previous session, it rose to as high as $1.192, but
went no further, which Mizuho's Jones said could be due to the European Central Bank having signaled its
awareness of the downsides of rapid euro strength EUR=EBS . The Australian dollar - seen as a liquid proxy for risk appetite - was flat, holding gains it made in
the immediate aftermath of the vaccine news. AUD=D3 .
The New Zealand dollar was up 0.2% and poised to extend to eight days its streak of consecutive
session of gains NZD=D3 .
China's offshore yuan, which has been gradually strengthening since May, was up slightly on Tuesday
after hitting 2-1/2-year highs versus the U.S. dollar on Monday. CNH=EBS .
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Currency bid prices at 2:46PM (1946 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Dollar index =USD $92.6750 92.7400 -0.06% +0.00% +92.9770 +92.6010
Euro/Dollar EUR=EBS $1.1823 $1.1814 +0.08% +5.47% +1.1843 +1.1780
Dollar/Yen JPY=D3 105.2800 105.3600 -0.09% -3.08% +105.4800 +104.8300
Euro/Yen EURJPY= 124.48 124.45 +0.02% +2.07% +124.6000 +124.0000
Dollar/Swiss CHF=EBS 0.9143 0.9138 +0.07% -5.50% +0.9175 +0.9116
Sterling/Dollar GBP=D3 1.3254 1.3162 +0.71% -0.05% +1.3277 +1.3154
Dollar/Canadian CAD=D3 1.3010 1.3007 +0.02% +0.15% +1.3050 +1.2985
Aussie/Dollar AUD=D3 0.7286 0.7282 +0.07% +3.85% +0.7294 +0.7253
Euro/Swiss EURCHF= 1.0809 1.0787 +0.20% -0.38% +1.0822 +1.0783
Euro/Sterling EURGBP= 0.8918 0.8971 -0.59% +5.49% +0.8983 +0.8885
NZ NZD=D3 0.6830 0.6817 +0.23% +1.55% +0.6839 +0.6804
Dollar/Dollar
Dollar/Norway NOK=D3 9.0040 9.0340 -0.12% +2.87% +9.0535 +8.9875
Euro/Norway EURNOK= 10.6481 10.6685 -0.19% +8.24% +10.6992 +10.6150
Dollar/Sweden SEK= 8.6003 8.6282 -0.15% -7.99% +8.6527 +8.6007
Euro/Sweden EURSEK= 10.1687 10.1835 -0.15% -2.87% +10.2145 +10.1688
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