FOREX--Dollar struggles as rising oil prices lift commodity currencies

* Pound near seven-week low on Brexit worries, negative
rates
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

By Julien Ponthus
LONDON, May 18 (Reuters) - A jump in oil prices lifted
commodity currencies such as the Norwegian crown and the
Canadian dollar against the U.S. dollar on Monday as optimism
about a reopening of economies stifled by the coronavirus
pandemic boosted risk appetite.
The gradual easing of lockdowns has raised hope across
global markets, despite fresh trade tensions between the United
States and China, though traders were wary of taking big bets
before more data this week.
"The surge in oil prices will also provide a selective
opportunity to sell the U.S. dollar against oil-sensitive major
currencies," wrote Stephen Innes, chief global markets
strategist at AxiCorp.
The Norwegian crown was lifted by rising oil prices,
supported by output cuts and signs of a recovery in demand.
Against the dollar, Norway's crown NOK=D3 rose more than
1% to 10.0821. The Canadian dollar rose 0.52% to 1.4036.
Other commodity currencies also rose and gold gained more
than 0.7%, hovering across its highest in over seven years.
The dollar index =USD , which posted gains of about 0.6%
last week, gradually gave up early gains and was down 0.12% at
$100.25.
U.S. Federal Reserve Chairman Jerome Powell's willingness to
print more dollars and extend the monetary stimulus further to
fight the coronavirus economic crisis was welcomed by investors.

Bets against the U.S. dollar shrank to the smallest position
in seven weeks in the latest week, according to calculations by
Reuters and U.S. Commodity Futures Trading Commission data
released on Friday.
Gains in stocks also lifted other major currencies, such as
the Australian dollar, which was up AUD=D3 half a percent at
$0.6446. The euro EUR=D3 fell 0.1% to $1.0806.
Against the yen JPY= , the U.S. currency fell about 0.25%
to 107.30 per dollar after data showed Japan slipped into
recession for the first time since 2015. Policymakers are
bracing for the nation's worst postwar slump.
Investors were also looking to Purchasing Managers' Index
surveys due from major economies later this week for the next
insight into the outlook.
The pound took back some ground lost earlier against the
euro and was trading at 89.08 pence EURGBP=D3 after a
week-long deadlock over a post-Brexit trade deal with the
European Union.
Money markets also ramped up expectations of negative
interest rates in the United Kingdom for the first time ever as
policymakers debated further steps to support the struggling
British economy. <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^
FX positions https://tmsnrt.rs/3bJyfVj
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