* Investor panic over coronavirus eases
* Dollar close to two-month highs ahead of Fed meeting
* Safe-haven yen, Swiss franc steady after pulling back
* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
LONDON, Jan 29 (Reuters) - The dollar held near two-month
highs on Wednesday and other currencies seen as safe havens
stabilised as investors regained their composure after an
outbreak of coronavirus in China, awaiting more news on possible
economic damage.
The dollar's strong showing this week, helped by the
relatively positive performance of the U.S. economy, has
underlined its safe-haven credentials.
The dollar index was last up 0.1% at 98.089 .DXY , while
the euro was down 0.2% versus the U.S. currency at $1.1002
EUR=EBS , not far from its weakest since early Nov. 29.
The greenback is now up 1.8% against a basket of major
currencies so far in 2020, ahead of a Federal Reserve meeting
later on Wednesday.
The Fed is not expected to change interest rates when it
gives its decision at 1900 GMT, but investors will want to hear
whether chairman Jerome Powell retains his cautiously upbeat
language.
ING analysts said that with the market already pricing in
another 25 basis point rate cut from the Fed in 2020, the U.S.
currency looked like it would hold recent gains.
"With dovish pricing already in place, the bar for a dollar
decline vs low yielding currencies such as JPY or EUR remains
high," they wrote in a research note.
The yen, which jumped earlier this week as investors bought
into a currency considered a safe store of value in times of
stress, traded at 109.10 yen per dollar JPY=EBS , up marginally
on the day.
The Swiss franc rallied 0.1% to 1.0713 francs per euro
EURCHF=EBS but was some way off Tuesday's high of 1.0666.
"The dollar is the outperformer and illustrates in an
impressive manner who is the ultimate safe haven in the FX
universe - regardless of whether that is justified or not,"
Commerzbank analyst Antje Praefcke said.
The newly identified coronavirus has created alarm because
it is spreading quickly and there is little known about it. The
death toll rose sharply to 132 on Wednesday, with nearly 1,500
new cases identified for a total of nearly 6,000. But there was evidence that investors were becoming more
relaxed.
The offshore yuan - heavily sold in recent days - was
marginally stronger at 6.9605 per dollar CNH=EBS , off Monday's
6.9900, its weakest in almost a month.
Sterling fell 0.1% to $1.3020 GBP=D3 ahead of a Bank of
England meeting on Thursday. Investors are divided as to whether
it will cut rates.
Australia's dollar cemented its rebound from 3-1/2 month
lows after firmer-than-expected inflation data. The Aussie was
last unchanged on the day at $0.6761 AUD=D3 .