FOREX-Risk currencies gain as Trump gives way to transition, Yellen emerges as Biden pick

* Yellen seen as supportive of monetary and fiscal stimulus
* Trump gives nod to transition process, boosting risk
appetite
*
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

By Hideyuki Sano
TOKYO, Nov 24 (Reuters) - Risk-sensitive currencies gained
on Tuesday as investors breathed easier after U.S. President
Donald Trump accepted the start of a transition to a Biden
administration, that is expected to include former Federal
Reserve Chair Janet Yellen as Treasury secretary.
Trump gave the head of the General Services Administration
the go-ahead to proceed with a transition to a government led by
President-elect Joe Biden despite plans to continue with legal
challenges. Democratic allies to the Biden campaign said Yellen is
expected to be nominated to become Treasury Secretary,
heartening investors as she has called for increased government
spending to lift the economy out of a coronavirus induced
recession. "One thing is for sure and that is there is unlikely to be
as many Fed-Treasury spats," said Chris Rupkey, chief financial
economist at MUFG Union Bank in New York.
"Those Fed lending facilities for municipal funding, the
corporate bond market and Main Street will be coming back
quickly after the December 31 expiration date."
Last week U.S. Treasury Secretary Steven Mnuchin let some of
the Fed's lending programmes expire at the end of this year,
opening a feud with the Fed, which said those emergency
facilities are important to support the economy. The Australian dollar ticked up 0.4% to $0.7313 AUD=D4
while emerging market currencies such as the Mexican peso
MXN=D4 and the South African rand also gained about 0.4%
ZAR=D4 .
The New Zealand dollar NZD=D4 soared as much as 0.9% to
scale a two-year high of $0.6985 also after the country's
government sought advice from the Reserve Bank of New Zealand
(RBNZ) on how it could help stabilise property prices, prompting
investors to unwind wagers of more monetary easing. The dollar held firmer against the safe-haven yen and the
euro, after IHS Markit's U.S. manufacturing and services sector
purchasing managers' indexes (PMI) both topped even the most
optimistic forecasts in a Reuters poll. While the U.S. PMI is usually not a big market mover, the
reading made a sharp contrast with less inspiring figures from
Europe published several hours earlier, helping the dollar to
gain against the euro, traders said.
The safe-haven yen traded at 104.49 per dollar JPY= ,
having slipped about 0.6% overnight while the euro slipped to
$1.1844 EUR= on Monday.
That helped to lift the dollar index to 92.463, off Monday's
low of 92.013, its lowest since Sept. 1.
"The apparent strength of the U.S. data was favourable for
the dollar," said Kyosuke Suzuki, director of forex at Societe
Generale.
But Suzuki added that, despite its latest gains, the
dollar's downtrend is likely to continue given the U.S. is
running huge fiscal and trade deficits.
The U.S. currency's safe-haven appeal was also dented after
AstraZeneca AZN.L further lifted investors' appetite for risk
by saying its COVID-19 vaccine could be about 90% effective and
it would prepare to submit data to authorities around the world
that have a framework for conditional or early approval.

The British pound held firm near a 12-week high against the
dollar and six-month high versus the euro, propped up by bets
Britain and the European Union would clinch a Brexit trade deal.
London and Brussels this week continue their negotiations to
agree a deal on their future trading relationship, though time
is now running very short as Britain's post-Brexit transition
period ends in fewer than six weeks.
The pound stood at $1.3330 GBP=D4 , having hit a high of
$1.3396 on Monday. Against the euro, it traded at 0.8887 to the
euro EURGBP=D4 , near its six-month high touched about two
weeks ago.