(Adds details, updates prices; changes byline, dateline;
previous LONDON)
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
By Karen Brettell
NEW YORK, July 28 - The dollar index bounced off a two-year
low on Tuesday, but looked primed for further weakness as the
United States continued to see a rise in coronavirus cases,
while the Federal Reserve is expected to maintain very loose
monetary policies.
The dollar index against a basket of currencies =USD
rebounded by 0.18% to 93.71, after dropping to 93.47 on Monday,
the lowest since June 2018.
With no new events driving the move, analysts said the
greenback is likely consolidating before heading lower again.
“I think the market is just talking a pause, it's been a
fairly relentless dollar selloff,” said Vassili Serebriakov, an
FX strategist at UBS in New York.
The continued spread of coronavirus is hampering the U.S.
economic recovery, while regions like Europe appear to have the
virus contained.
“The global economy has been recovering from COVID somewhat
unevenly, but I think the base of the recovery in places like
Europe and China is looking more encouraging than in the U.S.,”
said Serebriakov. “The dollar is countercyclical, so when the
global economy picks up the dollar tends to weaken.”
The dollar index has fallen from a three-year peak of 102.99
in March.
The euro EUR= dipped 0.18% against the dollar to $1.1730,
after reaching $1.1781 on Monday, the highest since September
2018.
U.S. Republicans and Democrats faced difficult talks on
Tuesday on how best to recover from the coronavirus pandemic,
after Republicans unveiled a relief proposal four days before
millions of Americans lose unemployment benefits. Ultra-loose Fed policy is also weighing on the U.S.
currency, with the central bank signaling that it will keep
rates near zero for years to come.
Investors will be watching to see if the Fed indicates that
it will increase its purchases of longer-dated debt and whether
yield caps are likely going forward when it concludes its
two-day meeting on Wednesday.
The dollar dipped 0.33% to 105.02 yen JPY= on Tuesday,
after earlier getting as low as 105.01 yen, the weakest since
March 13.
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Currency bid prices at 10:03AM (1403 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR= $1.1730 $1.1751 -0.18% +4.64% +1.1773 +1.1700
Dollar/Yen JPY= 105.0200 105.3700 -0.33% -3.53% +105.6800 +105.0300
Euro/Yen EURJPY= 123.20 123.81 -0.49% +1.03% +123.9800 +123.2300
Dollar/Swiss CHF= 0.9160 0.9197 -0.40% -5.34% +0.9227 +0.9156
Sterling/Dollar GBP= 1.2923 1.2881 +0.33% -2.53% +1.2930 +1.2839
Dollar/Canadian CAD= 1.3389 1.3354 +0.26% +3.10% +1.3406 +1.3331
Australian/Doll AUD= 0.7150 0.7149 +0.01% +1.82% +0.7176 +0.7114
ar
Euro/Swiss EURCHF= 1.0746 1.0808 -0.57% -0.98% +1.0827 +1.0744
Euro/Sterling EURGBP= 0.9077 0.9120 -0.47% +7.35% +0.9138 +0.9078
NZ NZD= 0.6657 0.6682 -0.37% -1.17% +0.6702 +0.6634
Dollar/Dollar
Dollar/Norway NOK= 9.1135 9.0924 +0.23% +3.82% +9.1520 +9.0495
Euro/Norway EURNOK= 10.6929 10.6835 +0.09% +8.69% +10.7195 +10.6548
Dollar/Sweden SEK= 8.7615 8.7183 +0.11% -6.27% +8.7922 +8.7142
Euro/Sweden EURSEK= 10.2788 10.2671 +0.11% -1.82% +10.2966 +10.2584
(Editing by Marguerita Choy)