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FOREX-Dollar squeezed as virus drives easing expectations

Published 19/11/2020, 01:38
© Reuters.
EUR/USD
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* Dollar index steady after five sessions of losses
* Yen claws back post-vaccine losses
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

By Tom Westbrook
SYDNEY, Nov 19 (Reuters) - The dollar nursed losses after
five sessions of decline and the yen held on to most of its
recent gains on Thursday, as investors worried about rising
coronavirus deaths and began to wager on more monetary stimulus
from the U.S. Federal Reserve.
The dollar touched its lowest since early last week against
a basket of currencies =USD overnight and has ceded ground
broadly, even with equity markets slipping, as mixed economic
data underscored the fragility of the U.S. recovery.
The dollar index is down about 0.2% for the week so far and,
at 92.549, is less than 1% above a two-year low hit in
September.
The safe-haven yen, meanwhile, has recouped almost three
quarters of the steep loss it suffered last week when Pfizer
announced its COVID-19 vaccine.
Moves in Asian morning trade were slight, with the yen
JPY= a fraction weaker at 103.92 per dollar, but not far above
an eight-month high of 103.18 made two weeks ago.
The New Zealand dollar NZD=D3 and Norwegian krone NOK=D3
likewise hung on to most of Wednesday's gains. The Aussie
AUD=D3 lagged a little as a fresh coronavirus outbreak
prompted a new hard lockdown in South Australia.
It was marginally softer at $0.7295, and saw no immediate
boost from better-than-expected labour data.
"Central bankers continue to offer promises of almost
endlessly easy money," said Societe Generale currency strategist
Kit Juckes.
"That, when U.S. COVID infection rates are causing enough
concern about growth prospects to offset vaccine news, has kept
the dollar on the backfoot, even as equities soften."
The largest public school district in the United States, in
New York City, will halt in-person teaching from Thursday to try
to curb COVID-19's spread, as U.S. deaths near a world-record of
a quarter-million lives lost to the respiratory disease.
The United States remains in a "severe recession" and growth
vulnerable to swings in infection rates, New York Federal
Reserve President John Williams said on Wednesday, who
reiterated the bank would use all its tools to help the economy.
Elsewhere, hopes of a post-Brexit trade deal have kept
sterling supported, and the euro was steady, though both dipped
slightly as the dollar held its ground in Asia on Thursday.
Sterling GBP= last traded 0.2% softer at $1.3234 and the
common currency EUR= at $1.1839.
The Chinese yuan sat near a 29-month high in offshore trade
CNH= .
U.S. jobs figures will be closely watched on Thursday for
guidance on the Fed's next moves. At 1000 GMT European Central
Bank President Christine Lagarde appears at a European
Parliament Committee hearing in Frankfurt.

========================================================
Currency bid prices at 11:32AM in Sydney(0032 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR=EBS $1.1838 $1.1854 -0.13% +5.59% +1.1854 +1.1832
Dollar/Yen JPY=D3 103.9150 103.8200 +0.09% -4.33% +103.9750 +103.7450
Euro/Yen EURJPY= 123.02 123.05 -0.02% +0.88% +123.1200 +122.9900
Dollar/Swiss CHF=EBS 0.9122 0.9112 +0.12% -5.73% +0.9125 +0.9114
Sterling/Dollar GBP=D3 1.3236 1.3268 -0.23% -0.20% +1.3268 +1.3230
Dollar/Canadian CAD=D3 1.3091 1.3085 +0.06% +0.79% +1.3096 +1.3077
Aussie/Dollar AUD=D3 0.7295 0.7306 -0.14% +3.97% +0.7305 +0.7284
NZ NZD=D3 0.6909 0.6923 -0.19% +2.69% +0.6924 +0.6910
Dollar/Dollar


All spots FX=
Tokyo spots AFX=
Europe spots EFX=
Volatilities FXVOL=
Tokyo Forex market info from BOJ TKYFX

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