FOREX-Dollar, yen up as investors seek shelter amid pandemic crisis

* Dollar firm after worst week since 2009
* Yen higher with risk-off mood
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

By Tom Westbrook
SINGAPORE, March 30 (Reuters) - The dollar snapped a week of
declines and the safe-haven yen rose on Monday, as coronavirus
lockdowns tightened across the world and investors braced for a
prolonged period of uncertainty.
The greenback climbed against the pound, euro, kiwi and the
Australian dollar. Sterling GBP= was last 0.7% softer at
$1.2371, the Aussie AUD=D3 down by almost the same margin at
$0.6134 while the euro EUR=EBS was 0.5% weaker at $1.1082.
"Now that the (dollar) funding pressure is easing somewhat,
the focus is pretty much shifting towards assessing the damage,"
said Bank of Singapore currency analyst Moh Siong Sim.
"And there, the viral infection rate is still up in the air,
(and) it's a bit of risk-aversion."
The safe-haven Japanese yen JPY=EBS rose 0.5% to 107.41
yen per dollar. Both the dollar and yen gained strongly against
emerging market currencies. EMRG/FRX
The weekend brought more bad news on the virus front. Total
deaths are nearly 34,000. The United States has emerged as the
latest epicentre, with more than 137,000 cases and 2,400 deaths
and lockdowns are toughening worldwide. Anthony Fauci, director of the National Institute of Allergy
and Infectious Diseases, said the pandemic could ultimately kill
between 100,000 and 200,000 people in the United States, if
mitigation was not successful.
U.S. President Donald Trump, who had talked about reopening
the economy for Easter, on Sunday extended guidelines for social
restrictions to April 30. The yen rose nearly 1% against the Australian dollar
AUDJPY= and nearly 2% against the Korean won KRWJPY= with
the mood.
"Risk aversion is likely to stay elevated with the U.S. the
epicentre of COVID-19," National Australia Bank analysts said in
a note.
The Chinese yuan CNH= also slipped 0.3% in offshore trade
to 7.1080 after the People's Bank of China unexpectedly cut a
key interbank interest rate, the seven-day reverse repurchase
rate, by 20 basis points. The Singapore dollar SGD=D3 jumped briefly after the
city-state's central bank eased policy, as expected, but
emphasised stability rather than foreshadowing further
easing. DOLLAR DETHRONED?
The dollar's modest gains on Monday barely recover a
fraction of the ground it gave up last week, yet that slump
followed a massive surge that leaves the U.S. currency still
elevated.
Over the past two weeks the dollar first posted its biggest
weekly rise since the 2008 financial crisis and then its biggest
weekly drop since 2009. Signs of funding stress have eased but
not abated as hard cash remains in high demand.
"Risk aversion has been more important to the direction of
the dollar than traditional interest rate differentials,"
Standard Chartered analysts said in note.
"For the dollar to surrender some of its recent gains,
investors would need to shift their preferences back to a
broader basket of safe-haven assets."
Monday's moves showed some hint of that, since dollar gains
came in tandem with a rising yen and rallying bonds. MKTS/GLOB
Yields at the very short end of the U.S. curve dipped into
negative territory and the benchmark 10-year yield US10YT=RR
fell nearly 9 basis points to 0.6605%. Gold XAU= was flat.
Against a basket of currencies =USD the dollar rose 0.3%
to 98.641.