FOREX-Dollar shines against euro, riskier peers as virus hit widens

* Virus deaths top 2,000, economic paralysis deepens
* Weak German sentiment sends euro to 3yr low vs dollar
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

By Tom Westbrook
SINGAPORE, Feb 19 (Reuters) - The dollar stood tall over the
languishing euro and heavily sold exporter currencies on
Wednesday, as investors reckoned with a deepening economic
fallout from the coronavirus.
The new coronavirus has caused 2,004 deaths in China and
infected more than 74,000 people, while measures to contain it
have paralysed the economy and the supply chains it feeds.
Apple Inc AAPL.O has warned it will probably miss its
March quarter sales guidance amid disrupted production and
shopping habits. Car makers are idling plants for lack of parts.
The yield curve between U.S. three-month bills and 10-year
notes inverted overnight, a bearish economic signal, and German
investor confidence slumped as its economy stagnates, sending
the euro cheaper than $1.08 for the first time since 2017. US/
"The market is trying to model itself on coronavirus and
it's struggling really hard to understand how that goes and
that's pushing capital in to the U.S.," said Chris Weston, head
of research at Melbourne brokerage Pepperstone.
"The U.S. remains that least-dirty T-shirt, the best house
in a fairly shabby-looking neighbourhood. As a destination for
capital, it's still the light that you look for."
Against a basket of currencies, the greenback is sitting by
a four-month high at 99.452 =USD . It touched a one-week high
against the Australian and New Zealand dollars overnight.
Both Antipodean currencies are heavily exposed to China, and
both have lost roughly 5% against the dollar this year AUD=D3
NZD=D3 . Norway's krone, sensitive to the global growth outlook
via oil exports, has shed 6% in 2020 and slumped to an 18-year
low overnight NOK= .
The euro EUR= has fallen 3.7% amid increasing signs of
divergence between the European and U.S. economies.
The single currency last bought $1.0796. Moves in major
currencies were slight in morning trade.
China says figures indicating a slowdown in new cases in
recent days show the aggressive steps it has taken to curb
travel and commerce are slowing the spread of the disease beyond
central Hubei province and its capital, Wuhan.
That has not stopped worries mounting, with hedge funds
turning to proxies from railway movements to port activity and
air pollution to try and gauge how much production remains
offline. Gold is sitting above $1,600 an ounce for the first time
since U.S.-Iran tensions in the Middle East sent it spiking in
early January XAU= . Priced in euros, gold's value jumped
almost 2% to a record high overnight XAUEUR=R . GOL/
Investors are looking to the minutes from the Federal
Reserve's January meeting, due to be released at 1900 GMT, for
insight in to the Fed's thinking about virus risks. MKTS/GLOB
European purchasing managers index numbers and part-month
Korean export figures, both due on Friday, are also going to be
closely watched for the first hard signs of economic impact.
"We assess the risks are firmly skewed towards the negative
effects of COVID-19 lasting longer," Nomura analysts wrote in a
note, using the World Health Organisation's designation for the
illness caused by the coronavirus.
"Therefore, we maintain our cautious view through positions
in long USD/THB, long USD/CNH, long USD vs GBP, NZD and long
AUD/NZD."
China's yuan was last steady at 7.0017 per dollar in
offshore trade CNH= . CNY/