FOREX-Dollar stable, markets torn between upbeat data and virus fears

* U.S. housing data boosts optimism on economic recovery
* Chinese yuan, Aussie tick up after China PMI
* Sterling under spending pressure
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

By Julien Ponthus
TOKYO, June 30 (Reuters) - The dollar held on to modest
gains on Tuesday as upbeat U.S. home sales and Chinese factory
data left traders torn between optimism about global growth
rebounding and fears a surge in new COVID-19 cases could
jeopardise a swift V-shaped recovery.
California and Texas saw record rises in new infections on
Monday while in Britain, a reinforced lockdown was imposed in
the city of Leicester.
News on the economic front was far better with Wall Street
getting a boost from the U.S. housing market quickly recovering
in May from a plunge triggered by the pandemic L1N2E60NH .
A warning from U.S. Federal Reserve Chair Jerome Powell that
the outlook for the world's biggest economy was "extraordinarily
uncertain", however, kept investors on their toes. Against a basket of currencies, the dollar index was up
0.27% at 97.686 while the euro EUR=EBS lost 0.3% at $1.1209.
Over the quarter, the European currency staged a 1.7%
comeback after falling by a similar margin during the first
three months of the year marked by the coronavirus financial
market crash.
"Markets are jumpy. Tension remains between economic and
virus pickup," said Moh Siong Sim, an FX analyst at the Bank of
Singapore.
The safe-haven Swiss franc CHF=EBS slipped marginally. The
dollar rose 0.1% against the franc to 0.9521 while it was also
climbed against the Japanese yen, another currency considered a
safe store of value, and last up 0.1% to 107.715 yen JPY= ,
Earlier the Chinese yuan and the Australian dollar gained
slightly after a survey showed China's factory activity expanded
at a stronger pace in June, beating expectations of slowdown
from last month.
The offshore yuan rose 0.1% to 7.072 per dollar CNH=EBS
while the Aussie dropped 0.2% to $0.6854 AUD=D3 .
The market shrugged off news that China's parliament passed
national security legislation for Hong Kong. That came after the
United States earlier began eliminating Hong Kong's special
status under U.S. law. "With most of the majors sitting mid-range versus the
greenback, the lack of trading winds looks set to continue",
wrote Jeffrey Halley, a market analyst at Oanda to his clients.
Worries about a blowout in British public spending kept the
pound under pressure.
Sterling traded at $1.2283 GBP=D4 after sliding to a
one-month low of $1.2252 on Monday on concerns about how
Britain's government would pay for its planned infrastructure
programme following Prime Minister Boris Johnson's promise to
increase spending. Ongoing concerns about Britain's ability to seal a trade
pact with the European Union also weighed.