(New throughout, updates prices, changes byline, dateline;
previous LONDON)
* Graphic: World FX rates https://tmsnrt.rs/2RBWI5E
(Updates prices, adds detail and commentary)
By Karen Brettell
NEW YORK, March 2 (Reuters) - The dollar gained for a fourth
consecutive day on Tuesday after a recent spike in bond yields
challenged the market consensus for dollar weakness in 2021,
while riskier currencies rose as bond markets calmed and stocks
recovered.
Rising yields have spooked markets in recent weeks, with
participants worried that an economic recovery from the impact
of the COVID-19 pandemic, combined with fiscal stimulus, could
cause a jump in inflation and potentially faster tightening from
the Federal Revere than previously anticipated.
The rising volatility has benefited the greenback as
investors unwind trades.
“If you do see volatility the natural inclination is to take
risk off the table, in this case it just basically means getting
out of existing positions and the dollar shorts are extremely
elevated at this point” said Bipan Rai, North American head of
FX strategy at CIBC Capital Markets in Toronto.
Short U.S. dollar positions were last at $29.33 billion,
according to data by the Commodity Futures Trading Commission.
The dollar index =USD rose 0.09% to 91.089, after earlier
reaching a three-week high of 91.396.
Riskier currencies including the Australian dollar continued
to rebound from last week's selloff as bond markets appeared to
calm. The Aussie also gained after the Reserve Bank of Australia
recommitted to keeping interest rates at historic lows.
The Australian dollar AUD=D3 gained 0.39% to $0.7802
versus the U.S. dollar, but remains below the three-year high of
$0.8007 reached on Thursday.
Karen Jones, a technical analyst at Commerzbank, said that
the Aussie and other risky currencies including the Norwegian
krone appeared to be reversing from interim tops, which will
likely be positive for the U.S. dollar near-term.
The “U.S. dollar bear trend is probably over” for now, Jones
said in a report.
The greenback was last down 0.48% against the krone NOK=
at 8.520 krone, but is holding above the 8.313 krone per dollar
level reached last week, the weakest for the dollar in more than
two years.
Safe-haven currencies including the Swiss franc and Japanese
yen, meanwhile, continued to weaken on Tuesday as risk appetite
improved.
The Swiss franc hit its lowest since November 2020 against
the dollar at 0.9193 CHF=EBS .
The yen JPY=D3 was the weakest since August at 106.95.
The euro also fell after top European Central Bank officials
sounded the alarm over the rises in bond yields. The single currency EUR=EBS was last down 0.10% at
$1.2037.
Bitcoin dipped 1.12% to $49,097. Citi said in a report that
the popular cryptocurrency was at a "tipping point" and could
become the preferred currency for international trade
BTC=BTSP . Currency bid prices at 9:41AM (1441 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Dollar index =USD 91.0890 91.0170 +0.09% 1.231% +91.3960 +91.0090
Euro/Dollar EUR=EBS $1.2037 $1.2049 -0.10% -1.49% +$1.2050 +$1.1992
Dollar/Yen JPY=D3 106.8350 106.8800 +0.05% +3.52% +106.9500 +106.7650
Euro/Yen EURJPY= 128.58 128.61 -0.02% +1.31% +128.7600 +128.1900
Dollar/Swiss CHF=EBS 0.9176 0.9148 +0.30% +3.71% +0.9193 +0.9146
Sterling/Dollar GBP=D3 $1.3916 $1.3926 -0.06% +1.87% +$1.3931 +$1.3860
Dollar/Canadian CAD=D3 1.2648 1.2645 +0.04% -0.66% +1.2697 +1.2633
Aussie/Dollar AUD=D3 $0.7802 $0.7772 +0.39% +1.43% +$0.7815 +$0.7737
Euro/Swiss EURCHF= 1.1043 1.1023 +0.18% +2.18% +1.1054 +1.1004
Euro/Sterling EURGBP= 0.8649 0.8651 -0.02% -3.22% +0.8667 +0.8638
NZ NZD=D3 $0.7266 $0.7266 +0.01% +1.20% +$0.7279 +$0.7210
Dollar/Dollar
Dollar/Norway NOK=D3 8.5195 8.5590 -0.48% -0.80% +8.6270 +8.4945
Euro/Norway EURNOK= 10.2526 10.3100 -0.56% -2.05% +10.3790 +10.2268
Dollar/Sweden SEK= 8.4238 8.4235 -0.11% +2.77% +8.4703 +8.4150
Euro/Sweden EURSEK= 10.1398 10.1512 -0.11% +0.63% +10.1667 +10.1327
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