FOREX-Aussie and Kiwi dollars lead gains; dollar falls

* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh

LONDON, June 22 (Reuters) - The U.S. dollar fell in
overnight trading on Monday, edging away from last week's
two-and-a-half-week highs, while the riskier New Zealand and
Australian dollars gained as fears of a second wave of COVID-19
did little to dampen investors' risk appetite.
The World Health Organization (WHO) reported a record
increase in global novel coronavirus cases on Sunday.
The rate of spread of the virus in Germany jumped over the
weekend, raising the possibility of renewed restrictions on
activity in Europe's largest economy. But markets took confidence from the containment of cases.
The number of new cases in Beijing went down, as local
authorities restrict the movement of people in the Chinese
capital and step up other measures to prevent the virus from
spreading. The biggest rise in cases on Sunday was in North America and
South America, the WHO said.
"FX markets start the week in quiet function and perhaps the
challenge this week will be whether markets can take the daily
swings in new U.S. virus cases in its stride," wrote ING
strategists in a note to clients.
Commodity currencies led the gains in early London trading
on Monday, with the New Zealand dollar hitting a session high of
0.6439, up around 0.5% on the day NZD=D3 .
The Australian dollar was up 0.5% at 0.6865 AUD=D3 ,
benefiting from comments by the head of the country's central
bank that the currency's recent rise was not a problem and that
the impact of the COVID-19 pandemic would not be as bad as first
feared. Against a basket of currencies =USD , the U.S. dollar fell
gradually in overnight trading but recovered some losses in
upticks around 0530 GMT and 0700 GMT. It was at 97.452 at 0735
GMT, down 0.2% on the day.
A global crunch for U.S. dollars that was a hallmark of the
early moments of the coronavirus crisis appears to have passed,
showed data from the Federal Reserve last week. Dollar short positions increased in the week to June 16th,
according to weekly futures data, indicating broader market
optimism about an economic recovery. The safe-harbour yen was little changed, at 106.92 per U.S.
dollar, not far from a one-month high of 106.58 hit earlier in
June JPY=EBS .
The euro was up 0.2% versus the dollar, at 1.1201, edging
away from recent two-and-a-half-week lows EUR=EBS .
E.U. leaders agreed on Friday that urgent action was needed
to haul their coronavirus-hit economies from the deepest
recession since World War Two, but made no progress on a massive
stimulus plan that has divided them for weeks. Speculative long positions on the euro are at their highest
since May 2018 1099741NNET .
Manufacturing, services and composite PMI data for June are
due on Tuesday for countries including Australia, Japan, France,
Germany, Britain, the United States and the euro zone.
"Given these are diffusion indices and simply reflect
whether conditions are getting better or worse then surely at
some point soon these numbers are going to massively spike up
regardless of the actual level of growth," wrote Jim Reid,
multi-asset research strategist at Deutsche Bank.
Germany's economy had passed the worst of the crisis caused
by the coronavirus outbreak and was now expected to recover
gradually, Bundesbank President Jens Weidmann told German
newspaper Frankfurter Allgemeine Sonntagszeitung on Sunday.