FOREX-Commodity currencies hold firm on hopes of pandemic peak, oil output cut

* Hopes of pandemic peak support risk-sensitive currencies
* Commodity currencies benefit from oil output cut hopes
* Euro dented after EU fails to agree on more policy steps
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

By Hideyuki Sano
TOKYO, April 9 (Reuters) - Commodity currencies drew support
on Thursday from hopeful signs the coronavirus pandemic may be
peaking and that major oil producers may agree to cut output to
stem a plunge in oil prices.
The Australian dollar fetched $0.6225 AUD=D4 , down
slightly but still near its highest level since mid-March,
maintaining most of its gains since rallying from a 17-year
trough of $0.5510 touched three weeks ago.
The dollar's index against six other major currencies stood
flat at 100.15 =USD in early Thursday trade.
The index is down 0.6% so far this week as safe-haven flows
to the U.S. currency eased on rising hopes much of Europe and
the United States could soon see themselves out of the worst
period of the COVID-19 pandemic.
"New York reported its biggest death toll while infections
hit the highest level in four days in Spain and three days in
Italy," said Tohru Sasaki, head of Japan market research at
JPMorgan. "All these are negative but forecasts both from
governments and experts that the peak could come within days are
leading markets not to focus on those details."
New York state on Wednesday reported the most coronavirus
cases in the world, overtaking Spain, according to a Reuters
tally. The market's focus is now on U.S. initial jobless claims
data USJOB=ECI due at 1230 GMT.
The average forecasts of economists stood at 5.25 million
after a total of nearly 10 million claims over the past two
weeks.
"Markets already know that the economy is being hit by
extraordinary shocks," said JPMorgan's Sasaki. "Even if the
number increases, it will probably surprise few people while a
better reading could enhance the perception that the worst may
be over and trigger a bigger market reaction."
On top of hopes of a peak in the epidemic, commodity-linked
currencies, including the Aussie, got an additional boost from
hopes that major oil producing countries could agree to cut
output at a video conference on Thursday.
The Canadian dollar CAD=D4 traded at C$1.4025 per U.S.
dollar, not far off this week's peak at C$1.3945. The Canadian
currency has been recovering from a four-year low of C$1.4669
hit on March 20.
The Norwegian Krone also strengthened slightly, trading at
11.1205 per euro EURNOK= , near its highest since mid-March and
having gained almost 19% from a record low hit on March 19.
Media reports suggested Russia would cut its output and
Algeria's energy minister said he expected a "fruitful" meeting
though there remained tensions between the world's top three
producers, the United States, Saudi Arabia and Russia.
"Markets are now looking to the meeting of OPEC Plus. Some
people are having high expectations but getting a deal could be
tricky," said Kyosuke Suzuki, director of currency trade at
Societe Generale in Tokyo.
The euro was flat at $1.0858 EUR= , having slipped 0.35% on
Wednesday, after European Union finance ministers failed in
all-night talks to agree on more economic support for their
coronavirus-stricken economies. Two main sticking points were conditions for access to
emergency credit lines in the euro zones's bailout fund and the
notion of issuing joint debt by the bloc, so-called
"coronabonds".
The yen was little moved at 108.94 yen per dollar JPY= ,
having traded in a narrowing range so far this week.
"While the dollar/yen is supported by the overall risk-on
mood, there is selling from Japanese exporters above 109 yen,
which will likely limit the chance of a big break above that
level," said Yukio Ishizuki, senior strategist at Daiwa
Securities.

(Editing by Sam Holmes and Jacqueline Wong)