* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
By Saikat Chatterjee
LONDON, Jan 28 (Reuters) - The dollar held at a 8-week high
against its rivals on Tuesday as investors focused on the
economic fallout from a new coronavirus in China, though broader
market sentiment stabilised with the Chinese yuan and the
Australian dollar off early lows.
Global stocks and oil prices have tumbled in recent days on
fears the virus could do further damage to China's already
weakened economy, an engine of global growth. Currency markets
were subdued in early London trading as a two-day U.S. Federal
Reserve meeting kicks off later on Tuesday. "The market is taking a step back from the selloff earlier
due to the virus concerns though the dollar is unlikely to
weaken substantially as there is safe-haven demand for the
greenback," said Morten Lund, a senior FX strategist at Nordea.
Against a basket of its rivals .DXY , the dollar rose 0.1%
to 98.01, its highest level since early December and taking its
gains so far to 1.7%.
The Australian dollar AUD=D3 and its New Zealand
counterpart NZD=D3 led losers against the greenback, falling
0.2% and 0.1% respectively though both those currencies were off
early lows.
Investors' attention was firmly focused on the Chinese
currency in the offshore market with mainland markets shut for
holidays this week. In early London trading, the Chinese
currency gained 0.2% to 6.97 yuan per dollar.
Strength in the offshore yuan provided some calm to nervous
currency markets even as European stocks were struggling to hold
on to opening gains. The Chinese currency CNH=D3 has weakened
more than 2% in less than a week against the dollar.
Elsewhere, the yen JPY=EBS held steady at 108.97 per
dollar, close to its strongest level since Jan. 8.
Japan's currency has risen for the past five trading
sessions against the greenback due to the growing risk aversion.
The Swiss franc also benefited from the growing risk
aversion with the currency rising to a near three-year high
against the euro on Monday below 1.07 francs per euro EURCHF= .