* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
(Adds quote, economic outlook, updates prices)
By Karen Brettell
NEW YORK, Jan 29 (Reuters) - The dollar was little changed
on Friday while the Japanese yen sank to its lowest since
mid-November as investors rebalanced portfolios for month-end.
Bitcoin also jumped to a two-week high as a movement by
retail investors to pile into certain stocks expanded to
cryptocurrencies.
The greenback has been largely range-bound against a basket
of currencies for the past two weeks as investors evaluate
whether a selloff that sent the currency down almost 7% last
year is likely to continue.
It was little changed against a basket of currencies on
Friday =USD at 90.57. The index is up 1.53% from a three-year
low of 89.206 reached on Jan. 6.
"People are waiting for fresh drivers and I don't think we
get them ‘til next month," said Marc Chandler, chief market
strategist at Bannockburn Global Forex in New York.
"The question is whether the dollar's correction continues
or it is over, and I think that the jury is still out."
Employment data for January released next Friday is the next
major economic driver, while investors are also focused on
fiscal stimulus.
The U.S. Senate and House of Representatives will move next
week on President Joe Biden's plan to deliver COVID-19 relief to
Americans and businesses reeling from the pandemic, top
Democrats said on Thursday. The yen underperformed on Friday even as risk appetite
worsened, hitting a two-month low versus the dollar and a nearly
three-year low against the Swiss franc.
Analysts attributed the move to several factors, including
the dollar's yield advantage over the Japanese currency and
month-end portfolio reshuffling.
Bank of Japan policymakers discussed the merits of allowing
long-term yields to move more flexibly around the bank's target,
a summary of opinions at their January meeting showed on Friday.
Some of the move is also likely due to large short positions
against the greenback being squeezed, said Chandler. “The market
was a bit vulnerable to this,” he said.
The dollar was last up 0.50% at 104.73 yen JPY=D3 . It
earlier rose to 104.94.
"It's a very interesting move especially given that at the
same time global equity indices would suggest that risk
sentiment is not improving," said Valentin Marinov, head of G10
FX research at Credit Agricole, referring to the yen's drop
versus the dollar.
The Japanese currency typically gains a safe-haven bid when
risk sentiment sours.
U.S. stock indexes slumped on Friday as investors gauged the
efficacy data of Johnson & Johnson's COVID-19 vaccine, while a
standoff between Wall Street hedge funds and small, retail
investors contributed to volatility. .N
Bitcoin was boosted after Tesla Inc TSLA.O chief Elon Musk
tagged the cryptocurrency in his Twitter biography. Musk wrote
simply "#bitcoin" in his biography on the social media site.
It was last up at 2.2% at $34,300, after earlier
reaching$31,990. BTC=BTSP .
"Bitcoin got lost in the GameStop mania and Musk's tweet
brought cryptos back into the limelight," said Edward Moya,
senior market analyst at OANDA.
Assets that would benefit from decentralized finance are
gaining traction as some retail traders express frustration that
online trading brokers including Robinhood have curtailed their
ability to trade stocks including GameStop GME.N and some
cryptocurrencies. The dollar also dipped to a three-week low against the
Chinese yuan in offshore markets CNH=EBS as China's short-term
money rates rose for a fifth straight day, busting above the
central bank's interest rate corridor ceiling. “At the margin, tightening money market conditions in China,
which are boosting local rates and helping lift the CNH out of
its recent consolidation against the USD, may be adding to
broader market anxieties and weighing on USD sentiment,”
analysts at Scotiabank wrote in a report on Friday.
========================================================
Currency bid prices at 3:00PM (2000 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Dollar index =USD 90.5700 90.5640 +0.01% +0.00% +90.7800 +90.3630
Euro/Dollar EUR=EBS $1.2131 $1.2121 +0.09% -0.71% +$1.2156 +$1.2095
Dollar/Yen JPY=D3 104.7250 104.2100 +0.50% +1.39% +104.9350 +104.2750
Euro/Yen EURJPY= 127.04 126.35 +0.55% +0.09% +127.3300 +126.3300
Dollar/Swiss CHF=EBS 0.8906 0.8887 +0.22% +0.67% +0.8912 +0.8875
Sterling/Dollar GBP=D3 $1.3703 $1.3724 -0.15% +0.30% +$1.3750 +$1.3657
Dollar/Canadian CAD=D3 1.2801 1.2829 -0.22% +0.53% +1.2874 +1.2740
Aussie/Dollar AUD=D3 $0.7640 $0.7676 -0.45% -0.66% +$0.7704 +$0.7632
Euro/Swiss EURCHF= 1.0802 1.0769 +0.31% -0.05% +1.0810 +1.0761
Euro/Sterling EURGBP= 0.8850 0.8832 +0.20% -0.97% +0.8870 +0.8826
NZ NZD=D3 $0.7180 $0.7175 +0.07% -0.01% +$0.7225 +$0.7151
Dollar/Dollar
Dollar/Norway NOK=D3 8.5690 8.5890 -0.16% -0.14% +8.6545 +8.4930
Euro/Norway EURNOK= 10.3993 10.4193 -0.19% -0.65% +10.4775 +10.3157
Dollar/Sweden SEK= 8.3627 8.3062 +0.47% +2.03% +8.3797 +8.3128
Euro/Sweden EURSEK= 10.1449 10.0973 +0.47% +0.68% +10.1535 +10.1050