* Euro, sterling, fall vs dollar
* Biggest move in Chinese yuan vs dollar
* U.S. factory orders drop more than expected
* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
(Adds new comment, U.S. data, updates prices, changes byline,
dateline; previous LONDON)
By Gertrude Chavez-Dreyfuss
NEW YORK, May 4 (Reuters) - The U.S. dollar rose on Monday,
boosted by safe-haven flows as risk appetite waned amid fears
that last year's U.S.-China dispute will be reignited, this time
over the novel coronavirus.
U.S. President Donald Trump and Secretary of State Mike
Pompeo have pinned the blame for the pandemic on China, where
the new coronavirus outbreak is believed to have originated.
The latest salvo came from Pompeo on Sunday, who said there
was "a significant amount of evidence" that the virus emerged
from a laboratory in the central Chinese city of Wuhan.
"The dollar is outperforming and it's on the back of the
risk-off sentiment stemming from U.S.-China tensions," said Ed
Moya, senior market analyst at OANDA in New York.
In late morning trading, the dollar index was up 0.3% at
99.511 =USD , rising for a second straight day.
The dollar extended gains after data showed new orders for
U.S.-made goods fell more than expected in March, dropping
10.3%. Economists polled by Reuters had forecast factory orders
tumbling 9.7% in March. The euro fell 0.6% to $1.0913 EUR=EBS , while sterling slid
0.3% to $1.244 G0BP=D3 .
"Many investors are getting skeptical about the rebound we
saw in risk appetite since the March 23rd low in stocks,"
OANDA's Moya said. "You'll see investors become extremely
conservative and we'll see a steady stream of safe-haven flows,
which should benefit the dollar."
The biggest move in the currency markets was the Chinese
yuan, which fell to a six-week low of 7.1555 against the dollar
in the offshore market CNH=EBS . The dollar was last little
changed at 7.1334, but if the yuan falls again, the next levels
to watch would be the mid-March low of 7.1651 and
early-September low of 7.1975.
Analysts were debating how the United States might attack
China again - with more trade tariffs or even canceling the
payments on U.S. Treasuries that China owns - but they all
agreed the dollar/yuan cross would see higher volatility.
"A re-escalation in U.S.-China trade tensions has the
potential to bring an end to the relative stability in USD/CNY,"
said Lee Hardman, a forex strategist at MUFG.
The moves extended a dour start for May, which began with
Friday's bleak U.S. data and the threat of a fresh trade-war
between the world's two biggest economies.
Pompeo did not provide evidence, or dispute a U.S.
intelligence conclusion that the virus was not manmade. But the
comments double down on Washington's pressure on China as U.S.
deaths and economic damage mount.
The dollar was modestly up against the yen, another
safe-haven currency, trading 0.1% higher at 106.965 yen
JPY=EBS .
With signs pointing to a stronger dollar, speculators cut
slightly their net short positions on the U.S. currency against
G10 currencies to $9.39 billion in the week to April 28 from
$10.67 billion in the week prior to that, when they reached a
near two-year high NETUSDG10= .
========================================================
Currency bid prices at 10:25AM (1425 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR= $1.0911 $1.0983 -0.66% -2.67% +1.0980 +1.0911
Dollar/Yen JPY= 107.0300 106.9300 +0.09% -1.68% +107.0600 +106.6800
Euro/Yen EURJPY= 116.81 117.39 -0.49% -4.21% +117.3900 +116.6200
Dollar/Swiss CHF= 0.9655 0.9612 +0.45% -0.24% +0.9659 +0.9614
Sterling/Dollar GBP= 1.2422 1.2502 -0.64% -6.31% +1.2502 +1.2406
Dollar/Canadian CAD= 1.4091 1.4084 +0.05% +8.51% +1.4151 +1.4051
Australian/Doll AUD= 0.6405 0.6418 -0.20% -8.77% +0.6433 +0.6373
ar
Euro/Swiss EURCHF= 1.0539 1.0552 -0.12% -2.89% +1.0563 +1.0535
Euro/Sterling EURGBP= 0.8782 0.8783 -0.01% +3.88% +0.8814 +0.8773
NZ NZD= 0.6020 0.6067 -0.77% -10.63% +0.6062 +0.6009
Dollar/Dollar
Dollar/Norway NOK= 10.3810 10.2090 +1.68% +18.26% +10.4740 +10.3517
Euro/Norway EURNOK= 11.3337 11.3550 -0.19% +15.22% +11.4649 +11.3255
Dollar/Sweden SEK= 9.8860 9.8391 -0.16% +5.76% +9.9395 +9.8131
Euro/Sweden EURSEK= 10.7927 10.8095 -0.16% +3.08% +10.8689 +10.7947
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Chinese yuan falls to lowest in 6 weeks vs dollar IMAGE https://tmsnrt.rs/3dcQovL
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