* Control of both Houses gives Biden scope to push agenda
* Riskier currencies seen outperforming on growth prospects
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
By Kevin Buckland and Stanley White
TOKYO, Jan 7 (Reuters) - The dollar languished near its
lowest level in nearly three years on Thursday after Democrats
won control of the U.S. Senate, clearing the way for a larger
fiscal stimulus under President-elect Joe Biden. Currency markets were largely unperturbed by scenes of chaos
in Washington as supporters of outgoing President Donald Trump
stormed Capitol Hill. Analysts generally assume a Democrat-controlled Senate would
be a net positive for economic growth globally and thus for most
risk assets, but negative for bonds and the dollar as the U.S.
budget and trade deficits may widen further. The dollar index =USD was little changed at 89.321 in
early Asian trade on Thursday, after dipping to its lowest since
March 2018 at 89.206 overnight.
The yield on the benchmark 10-year Treasury note
UST10YT=RR climbed as high as 1.054% on Wednesday for the
first time since the market mayhem of mid-March.
Masafumi Yamamoto, chief currency strategist at Mizuho
Securities in Tokyo, sees the dollar's fortunes split with
Democrats controlling both Houses.
"The dollar will remain weaker against commodity currencies
like the Aussie and emerging market currencies," which benefit
when risk sentiment is positive, he said.
At the same time, "higher Treasury yields should benefit the
dollar against the euro and the yen, because the dollar has
underpriced the potential for U.S economic recovery under
Biden."
The riskier Australian dollar was little changed at 78.025
U.S. cents AUD= after touching a nearly three-year high of
78.195 on Wednesday.
The euro EUR=EBS gained 0.1% to $1.23385, approaching the
$1.2349 level it reached Wednesday for the first time since
April 2018.
The dollar fell 0.1% to 102.965 yen, after dipping to
102.595 on Wednesday for the first time since March.
But after a fall of nearly 7% in 2020 for the dollar index
and a drop of as much as 0.9% in the new year, the U.S. currency
may get some respite from some unwinding of a crowded trade.
"People have been bearish on the dollar now for at least six
or nine months," said Minh Trang, senior FX trader at Silicon
Valley Bank in Santa Clara, California.
"Obviously you are going to have to take a little bit of a
breather every now and then."
Bitcoin BTC=BTSP marked a fresh all-time high of $37,386
on Thursday, extending a surge of more the 800% since mid-March.
It last traded at $37,382.
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Currency bid prices at 9:45AM (045 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR=EBS $1.2332 $1.2328 +0.03% +0.93% +1.2345 +1.2327
Dollar/Yen JPY=D3 102.9520 103.0400 +0.00% -0.24% +103.0620 +0.0000
Euro/Yen EURJPY= 126.97 127.00 -0.02% +0.04% +127.1900 +126.9700
Dollar/Swiss CHF=EBS 0.8782 0.8781 +0.02% -0.73% +0.8784 +0.8778
Sterling/Dollar GBP=D3 1.3616 1.3610 +0.04% -0.34% +1.3631 +1.3609
Dollar/Canadian CAD=D3 1.2671 1.2680 -0.07% -0.49% +1.2679 +1.2665
Aussie/Dollar AUD=D3 0.7791 0.7806 -0.17% +1.30% +0.7816 +0.7792
NZ NZD=D3 0.7287 0.7295 -0.04% +1.55% +0.7303 +0.7290
Dollar/Dollar
All spots FX=
Tokyo spots AFX=
Europe spots EFX=
Volatilities FXVOL=
Tokyo Forex market info from BOJ TKYFX