* New Zealand dollar hits strongest since March 2019
* Euro falls to 6-day low vs US dollar
* Nokkie, Swedish crown down against greenback
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
(Adds comment, updates prices)
By Olga Cotaga
LONDON, Nov 11 (Reuters) - The U.S. dollar rose on Wednesday
as optimism about a potential coronavirus vaccine was offset by
worries about how the drug will be delivered and by a surge of
new infections in the United States.
The New Zealand dollar soared to its strongest in a year and
a half as traders scaled back bets that the central bank would
move to negative interest rates.
Other riskier currencies, like the Norwegian crown and the
Australian dollar, also fell against the safe-haven greenback.
"People are taking a little more prescripted approach to the
vaccine. The news is undoubtedly positive, but of course we need
to delve into the detail and think about the ramifications of
the whole process," said Jeremy Stretch, head of G10 FX strategy
at CIBC Capital Markets.
Initial optimism about a coronavirus vaccine had pushed the
dollar down against riskier currencies and up against the
safe-haven yen and the Swiss franc. That momentum is starting to
fade because obstacles remain before a vaccine can be
distributed.
"We need to remember that this is a vaccine which is
unproven in terms of certification, there are all the logistical
challenges in terms of its implementation...we need to be a
little bit more sanguine about the risks," Stretch said.
He added that market participants should also remember that
infection rates in Europe and the United States remain elevated.
The euro hit a six-day low of $1.1756, down 0.5% on the day
EUR=EBS , while the U.S. dollar rose 0.3% to 105.50 versus the
Japanese yen JPY=EBS .
"With the global daily infections from the coronavirus
accelerating yesterday, it seems that concerns over the
pandemic's economic impact may have limited further gains in
equities and other risk-linked assets," said Charalambos
Pissouros, senior market analyst at JFD Group.
"It is still too early to start cheering that the COVID era
is behind us," he said.
The trade-sensitive Norwegian crown fell 0.6% versus the
U.S. dollar to 9.0660 NOK=D3 . The Aussie dollar fell 0.1% to
0.7276 AUD=D3 .
And the Swedish crown was also 0.5% lower on the day at 8.65
against the U.S. dollar SEK=D3 .
Sweden's banks should not pay out dividends until the
economic situation regarding the coronavirus pandemic has become
clearer, central bank Governor Stefan Ingves said on Wednesday.
Sentiment for the dollar got a boost on Monday after Pfizer
Inc PFE.N and BioNTech 22UAy.DE said on Monday their
experimental coronavirus vaccine was 90% effective.
The biggest mover in the G10 space was the Kiwi dollar,
which jumped to 0.6904 versus the U.S. dollar NZD=D3 in the
Asian trading session, its highest since March 2019. It was last
trading up 0.7% on the day at 0.6876.
Against the Australian dollar, the Kiwi strengthened 0.8% to
1.0578 AUDNZD= .
The Reserve Bank of New Zealand kept interest rates on hold
at 0.25% and introduced a new monetary policy tool to encourage
more loans by reducing borrowing costs for banks, which matched
market expectations. RBNZ Governor Adrian Orr also said domestic economic
activity since August has been more resilient than previously
assumed, which many traders took as a sign that the chance of
negative interest rates had receded.
"As a risk-linked currency, the Kiwi may continue to gain
against the U.S. dollar if the financial community stays in a
risk-on mode, and due to the lowering of the negative-rate
chance, it may even outperform the other commodity-linked
currencies, namely the Aussie and the Loonie (Canadian dollar),"
Pissouros said.
The Canadian dollar was down 0.2% at 1.3056 against the U.S.
dollar CAD=D3 .