FOREX-Yen falls on concerns Japan close to declaring state of emergency; sterling steadies

* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
* Japan on brink of state of emergency -local media
* Sterling shaken after PM Johnson admitted to hospital
* Oil currencies rattled by failure to end price war

By Stanley White
TOKYO, April 6 (Reuters) - The yen fell on Monday after
Japanese media said Prime Minister Shinzo Abe may declare a
state of emergency as early as Tuesday to curb an alarming spike
in coronavirus infections.
The pound trimmed losses against the dollar and euro after
Britain assured Prime Minister Boris Johnson continues to lead
the government after he spent the night in hospital for tests as
he was still suffering symptoms of the coronavirus. The dollar was on the back foot against the euro after data
last week showed companies in the United States shed jobs at
break-neck speed as the COVID-19 pandemic leads the global
economy into a deep recession.
"When a head of state or government is stricken like this,
it will cause concern for holders of sterling and sterling
assets," said Masafumi Yamamoto, chief currency strategist at
Mizuho Securities in Tokyo.
"Coronavirus cases in Japan may not peak for another month,
so the markets will think that now it's Japan's turn. A state of
emergency is necessary, but this could be yen negative."
The yen JPY=EBS fell 0.60% to 109.14 against the dollar.
It also weakened against the euro EURJPY=EBS , the Australian
dollar AUDJPY= , and the New Zealand dollar NZDJPY= .
Abe will declare a state of emergency over the virus as
early as Tuesday, the Yomiuri newspaper reported, as the number
of infections topped 1,000 in the capital, Tokyo.
He will likely announce his plans to declare the emergency
on Monday, the paper added. Japan is to pledge to take "all steps" encompassing fiscal,
monetary and tax policies to battle the deepening fallout from
the virus in a stimulus package to be approved on Tuesday, a
draft document reviewed by Reuters showed. Pressure has been mounting on the government to declare a
state of emergency as the pace of infections - while slow versus
harder-hit countries around the world - continues to accelerate.
The pound GBP=D3 trimmed losses to trade at $1.2263.
Against the euro EURGBP=D3 , it traded hands at 88.18 pence.
The currency came under pressure after Johnson was admitted
to hospital in what Downing Street said was a "precautionary
step" because he was showing persistent symptoms of COVID-19 10
days after testing positive for the virus.
Investors were concerned also because Britain's constitution
- an unwieldy collection of sometimes ancient and contradictory
precedents - offers no formal deputy or caretaker who would take
over if Johnson cannot continue to lead. The coronavirus, which emerged in China late last year, has
turned into a pandemic that has infected more than a million
people, killed over 68,000 and paralysed large swathes of the
global economy. In the offshore market, China's yuan CNH=D3 held steady at
7.1032 per dollar after the mainland reported 39 new coronavirus
cases on Sunday, all but one of them imported, up from the 30
reported a day earlier. China's mainland markets are closed
Monday for a public holiday. The dollar eased slightly to $1.0812 per euro EUR=EBS and
held steady at 0.9778 Swiss franc CHF=EBS .
U.S. President Donald Trump on Sunday expressed hope that
the United States was seeing a "leveling-off" of the virus
crisis in some of the nation's hot spots. However, sentiment for the greenback remains fragile after a
series of data last week showed U.S. job losses are soaring as
draconian measures to curb the virus hurt consumer spending and
factory activity. Currencies of major oil producers fell on Monday as crude
prices gave up some of their recent gains after Saudi Arabia and
Russia postponed to Thursday a meeting about a potential pact to
cut production. O/R
The rouble RUB=D3 opened 0.3% lower against the dollar,
while the Mexican peso fell to a record low. However, the
Norwegian crown NOK= held steady against the dollar.

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