(Adds comment, context, updates prices)
* Biden to give details of "trillions" in spending Thursday
* Many analysts still expect dollar to resume declines
* Graphic: World FX rates https://tmsnrt.rs/2RBWI5E
By Julien Ponthus
LONDON, Jan 14 (Reuters) - The dollar held above three-year
lows versus major peers on Thursday as expectations for
President-elect Joe Biden's fiscal stimulus pushed yields of
U.S. government bonds higher. The 10-year Treasury yield rose after CNN reported the
stimulus will be around $2 trillion, adding support for the
dollar and weakening gold.
At midday in Europe, the dollar index =USD was little
changed, up 0.06% at 90.420, as investors waited for Biden to
give details on Thursday of his pandemic relief plan.
The dollar has risen in four of the last five trading
sessions as the prospect of more stimulus has weighed on U.S.
government bonds, sending the benchmark Treasury yield above 1%
for the first time since March.
Expectations are high, but many analysts believe the
spending push has already been priced in.
"We feel the fiscal cat is out of the bag already: it would
take a lot to surprise markets after the re-pricing seen last
week," ING analysts said.
"The scope for the reflation trade to restart on the back of
this announcement alone is limited."
Benjamin Melman, chief investment officer at Edmond de
Rothschild AM, was also cautious. He said Biden might have to
scale back his stimulus ambitions to get the plan through
Congress.
"First, I am not sure a big fiscal stimulus is going to
happen. Secondly, the market is quite aware of it", he said.
The currency's recovery is also threatened by a build-up of
bearish dollar positions.
FX speculators have been net short the dollar since
mid-March, as investors' appetite for riskier assets hurt demand
for the greenback.
Because U.S. stimulus supports risk sentiment, that could
further weigh on the dollar, which is considered a safe haven.
The global recovery-sensitive Australian and New Zealand
dollars firmed to $0.7765 AUD= and $0.7204 NZD= .
The euro EUR=EBS eased 0.06% to $1.2144 despite positive
news from the bloc's economic powerhouse.
Germany's economy shrank by 5% in 2020, less than expected
and a smaller contraction than during the global financial
crisis, as unprecedented government rescue and stimulus measures
lessened the shock of the COVID-19 pandemic.
"One could say we got off lightly," LBBW analyst Uwe Burkert
said.
Bitcoin BTC=BTSP held on to 10% gains made on Wednesday
after a slide of nearly $12,000 from last week's record high of
$42,000. It rose about 2% to $38,092 on Thursday, up from as low
as $30,261.13 on Jan. 11.
Interest in the cryptocurrency surged as institutional
investors began buying heavily, viewing it as both an inflation
hedge and as exposed to gains if it becomes more widely adopted.
========================================================
Currency bid prices at 12:17PM (1217 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR=EBS $1.2151 $1.2159 -0.06% -0.55% +1.2172 +1.2135
Dollar/Yen JPY=D3 103.9800 103.8850 +0.10% +0.68% +104.1950 +103.8150
Euro/Yen EURJPY= 126.33 126.28 +0.04% -0.46% +126.5200 +126.2300
Dollar/Swiss CHF=EBS 0.8894 0.8875 +0.22% +0.54% +0.8899 +0.8866
Sterling/Dollar GBP=D3 1.3655 1.3637 +0.13% -0.05% +1.3678 +1.3620
Dollar/Canadian CAD=D3 1.2668 1.2701 -0.24% -0.49% +1.2706 +1.2666
Aussie/Dollar AUD=D3 0.7768 0.7734 +0.44% +0.98% +0.7771 +0.7729
NZ NZD=D3 0.7207 0.7175 +0.46% +0.38% +0.7207 +0.7173
Dollar/Dollar
All spots FX=
Tokyo spots AFX=
Europe spots EFX=
Volatilities FXVOL=
Tokyo Forex market info from BOJ TKYFX
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World FX rates https://tmsnrt.rs/2RBWI5E
dollar https://tmsnrt.rs/3oMz2fE
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