FOREX-Dollar weakens after another surprise Fed rate cut

* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
* Dollar falls early in Asia trade
* Central banks rushing to restore confidence in markets
* Investors fret economic impact of coronavirus

By Stanley White
TOKYO, March 16 (Reuters) - The dollar fell against a broad
range of currencies on Monday after the U.S. Federal Reserve
made another surprise interest rate cut and major central banks
took steps to relieve a shortage of dollars in financial
markets.
The U.S. Federal Reserve cut rates to a target range of 0%
to 0.25% and said it would expand its balance sheet by at least
$700 billion in coming weeks. Five other central banks also cut pricing on their swap
lines to make it easier to provide dollars to their financial
institutions facing stress in credit markets.
The moves come as policymakers respond to a brutal
months-long sell-off in financial markets due to worries about
the economic impact of the global spread of the coronavirus.
"It's a modest negative reaction for the U.S. dollar. The
Fed moved a little sooner and a little more aggressive that some
thought," said Ray Attrill, head of FX strategy at National
Australia Bank in Sydney.
"This cannot prevent the economic fallout from social
distancing (used to slow the coronavirus). That will require
some fiscal spending and something from the government to make
sure small companies are funded."
The dollar fell 1.5% to 106.35 yen JPY=EBS early on Monday
in Asia in reaction to the Fed's move, which was announced on
Sunday evening U.S. time.
The greenback also fell 0.9% to $1.2405 per British pound
GBP=D3 .
Against the euro EUR=EBS , the dollar slid 0.3% to $1.1153.
The dollar fell 0.3% to 0.9507 Swiss franc CHF=EBS .
The Fed, the Bank of Canada, European Central Bank, the Bank
of England, the Bank of Japan (BOJ) and Swiss National Bank also
agreed to offer three-month credit in U.S. dollars on a regular
basis and at a rate cheaper than usual.
The move was designed to bring down the price banks and
companies pay to access U.S. dollars, which has surged in recent
weeks as a coronavirus pandemic spooked investors.
The Fed had already cut interest rates by half a percentage
point on March 3 at an emergency meeting, the first emergency
cut since the financial crisis in 2008, but that move failed to
stem market volatility.
The Fed's move on Sunday U.S. time was likely aimed at
staving off what had the potential to be another volatile week
in financial markets, analysts say.
However, U.S. stock futures plunged after the rate cut,
suggesting investors remain nervous. L4N2B80YP
Later on Monday, China will release several important
economic indicators that should reveal the scale of damage
caused by coronavirus, which emerged in the central Chinese
province of Hubei late last year.
The Fed was originally scheduled to announce a policy
decision on Wednesday, and the BOJ holds a two-day meeting
ending Thursday, and the pressure has been on central banks to
do something to restore calm to financial markets.
Worries that travel restrictions and factory closures aimed
at containing the coronavirus will cause a global recession have
sent equities into a tailspin.
In the offshore market, the yuan CNH=D3 edged up slightly
to 7.0131 per dollar as traders awaited key Chinese economic
data.
The Reserve Bank of New Zealand joined the global easing
race with a cut of 75 basis points to its rates, while the
Reserve Bank of Australia added A$5.9 billion to the banking
system through market repo operations. The New Zealand dollar NZD=D3 fell 0.2% to $0.6045, while
the Australian dollar AUD=D3 fell 0.38% o $0.6164.