* Yen up 0.5% on report of bland G7 statement
* G7 draft has no new fiscal or monetary measures - source
* Aussie briefly jumps after RBA cut
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
By Tom Westbrook
SINGAPORE, March 3 (Reuters) - The safe-haven Japanese yen
gained on the dollar on Tuesday, as the market tempered hopes
for global monetary easing with worries about its scale and
efficacy in combating the economic damage from the coronavirus
outbreak.
G7 finance ministers and central bank governors hold a
conference call later on Tuesday to discuss measures to deal
with the outbreak and its widening economic fallout.
The call, which French and Italian sources said begins at
1200 GMT, comes with markets already betting the U.S. Federal
Reserve will lead a round of global monetary easing. MKTS/GLOB
The dollar fell 0.5% to 107.80 yen JPY= and edged lower on
the Swiss franc CHF= to 0.9576 francs after Reuters reported,
citing an unnamed G7 official, that the G7 draft statement had
no fresh fiscal or monetary pledges.
"We don't have high expectations that the G7 are going to
announce a coordinated policy easing," said CBA currency analyst
Joe Capurso by phone from Sydney.
"We see some central banks being reluctant to pull the
trigger, like the ECB, for example, and the Bank of Japan,
because they just don't have a lot of room to ease."
In a statement, expected on Tuesday or Wednesday, the G7
countries will pledge to work together to mitigate damage to
their economies, without detailing specifics, a source with
knowledge of the draft told Reuters on condition of anonymity.
That leaves investors again confronting fundamentals: The
virus and the economic slowdown it is causing will hurt, and the
damage may no longer be confined to China-exposed assets.
The extra room to respond in the United States, where the
Federal Reserve has its benchmark rate between 1.5% and 1.75%
compared with zero in Europe, has weighed on the dollar.
But fear has prevented strong gains beyond the euro EUR= ,
which rose as investors unwound carry trades. It last sat at
$1.1145, just below its month-high hit overnight.
The Australian dollar AUD=D3 briefly jumped after the
Reserve Bank of Australia (RBA) cut interest rates by only 25
basis points, as anticipated, and not more - which markets had
priced as a possibility. But then it fell back to trade just above flat at $0.6549.
The New Zealand dollar NZD=D3 also gave up intraday gains to
sit at $0.6261. AUD/
"Assurances of easier liquidity and fiscal support may help
stabilise the sentiment in the very short term, but the risk of
a higher rate of COVID-19 infections needs to be monitored
closely," said Citi EM Asia economist Johanna Chua in a note.
"The situation remains fluid and a lot depends on how
successful the G7 conference call is in keeping up with the
expectations of coordinated easing."
Also on the horizon is the release of euro zone inflation
data at 1000 GMT and the Super Tuesday Democratic Party
primaries in the United States.
The Bank of Canada meets to set its policy rate on
Wednesday.
(Editing by Jane Wardell and Jacqueline Wong)