FOREX-Dollar ticks lower as some risk aversion wanes

(New throughout)
By Kate Duguid
NEW YORK, April 17 (Reuters) - The dollar ticked lower on
Friday as investors, cautiously optimistic about the results of
a drug trial and President Donald Trump's plan to reopen the
economy, regained some appetite for risk.
Sentiment was boosted overnight by a media report detailing
encouraging partial data from experimental drug trials on
severely ill COVID-19 patients at a University of Chicago
hospital. News of Trump's plans to reopen the world's largest economy
was also taken by investors as a positive sign, even after
Thursday's jobless data showed a record 22 million Americans
sought unemployment benefits in the last month. The overnight moves toppled the dollar, which has closely
tracked risk sentiment through the coronavirus crisis, from a
week high, with the dollar index =USD last down 0.08%. Other
safe-haven assets like Treasury yields were lower, while the S&P
500 index .SPX rallied 1.8%.
The dollar also fell against the euro EUR= and the British
pound GBP= , though it strengthened against the Japanese yen
JPY= and the Swiss franc CHF= , other safe-haven currencies.
"I think there was general optimism today so the dollar took
a modest backseat," said John Doyle, vice president for dealing
and trading at Tempus, Inc.
"But overall, the dollar will remain king in the coming
months. Even as we come off of the dollar highs of last month,
it will stay historically strong."
The dollar will record a small weekly gain after the
safe-haven rally this week on dismal data from the United States
on Wednesday and Thursday and a report that China's economy
contracted in the first quarter, its first quarterly contraction
since the country began publishing the data in 1992. As the dollar fell, the euro rose 0.30%. The euro has fallen
about 1.46% against the dollar already this month, facing its
biggest monthly fall since July last year, after hitting its
lowest against the Swiss franc in almost five years earlier this
week. EURCHF=
With French President Emmanuel Macron warning that the
European Union could collapse unless it finds a way to share the
costs of the crisis, the coronavirus has exposed the
vulnerability of the single currency. "EUR's status might have been evolving since the COVID-19
outbreak but, going forward, we are bearish. This is because we
expect European data to decouple further from US data, and that
is partly due to the lack of a coordinated European fiscal
response - which we remain concerned about," wrote Bank of
America strategists in a note to clients.