* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
(Updates prices)
By Karen Brettell
NEW YORK, Dec 28 (Reuters) - The euro was boosted on Monday
as risk sentiment improved in the wake of Britain's trade deal
with the European Union and U.S. President Donald Trump's
decision to approve a new fiscal stimulus package.
Britain on Thursday clinched a narrow Brexit trade deal with
the EU, just seven days before it exits one of the world's
biggest trading blocs in its most significant global shift since
the loss of its empire. "What we are seeing is a continuation of the pricing out of
hard Brexit risk," said Ulrich Leuchtmann, head of FX research
at Commerzbank in Frankfurt.
Risk sentiment also improved after Trump on Sunday signed
into law a $2.3 trillion pandemic aid and spending package,
restoring unemployment benefits to millions of Americans and
averting a federal government shutdown. The euro gained 0.43% to 126.77 yen EURJPY= . It reached a
seven-month high of 1.0892 against the Swiss franc EURCHF= ,
before falling back to 1.0858, up 0.04% on the day.
The single currency was down 0.09% against the U.S. dollar
EUR=EBS at $1.2209.
It gained 1.00% against sterling EURGBP= to 0.9077.
Sterling has underperformed since the Brexit deal was
reached, with traders saying the news was likely priced in.
Also "I would argue that this is markets slowly but surely
acknowledging that this is not an optimal deal for the UK," said
Andreas Steno Larsen, global chief FX and rates strategist at
Nordea in Copenhagen.
"This is rather a very slim deal that merely avoids the
cliff edge, but there are still large gaps that will have to be
dealt with in 2021, and frictionless trade is not secured,"
Larsen said.
The British pound dipped 0.66% against the U.S. dollar
GBP=D3 to $1.3447, and was holding below a two-and-a-half-year
high of $1.3625 reached on Dec. 17.
Bitcoin BTC=BTSP climbed 2.74% to $26,695 but was below a
record high $28,378 reached on Sunday.
"There is a lot of enthusiasm among (crypto) traders who
truly believe in this asset class, and they know that the rally
has only begun because we were only recovering losses for the
past few years," Naeem Aslam, chief market analyst at AvaTrade,
said in a report.
The dollar gained 0.14% against a basket of currencies
=USD to 90.32.
Investors are betting the dollar will continue to decline -
it fell more than 6% this year - on expectations the Federal
Reserve will hold interest rates near zero and the U.S. economy
will struggle to recover from coronavirus-related shutdowns.
Win Thin, global head of currency strategy at Brown Brothers
Harriman, expects the dollar index to test its February 2018 low
of 88.25. Then "what happens to the greenback after that will
largely depend on how well the U.S. controls the virus in 2021
as well as the outlook for further fiscal stimulus," Thin said
in a report.
The dollar slipped 0.16% against the Canadian dollar CAD=
to $1.2848.
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Currency bid prices at 3:05PM (2005 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Dollar index =USD 90.3210 90.2010 +0.14% +0.00% +90.3800 +89.9780
Euro/Dollar EUR=EBS $1.2209 $1.2220 -0.09% +8.90% +$1.2253 +$1.2179
Dollar/Yen JPY=D3 103.8450 103.6550 +0.16% -4.41% +103.8900 +103.4200
Euro/Yen EURJPY= 126.77 126.23 +0.43% +3.95% +126.9500 +126.0700
Dollar/Swiss CHF=EBS 0.8895 0.8912 +0.01% -8.07% +0.8919 +0.8877
Sterling/Dollar GBP=D3 $1.3447 $1.3570 -0.66% +1.37% +$1.3573 +$1.3429
Dollar/Canadian CAD=D3 1.2848 1.2868 -0.16% -1.09% +1.2875 +1.2814
Aussie/Dollar AUD=D3 $0.7576 $0.7588 -0.34% +7.98% +$0.7622 +$0.7559
Euro/Swiss EURCHF= 1.0858 1.0854 +0.04% +0.06% +1.0892 +1.0851
Euro/Sterling EURGBP= 0.9077 0.8987 +1.00% +7.37% +0.9091 +0.8992
NZ NZD=D3 $0.7101 $0.7099 -0.31% +5.53% +$0.7138 +$0.7085
Dollar/Dollar
Dollar/Norway NOK=D3 8.6465 8.6400 +0.14% -1.36% +8.6820 +8.5985
Euro/Norway EURNOK= 10.5584 10.4829 +0.72% +7.32% +10.6220 +10.5102
Dollar/Sweden SEK= 8.2813 8.2318 +0.54% -11.40% +8.2952 +8.2179
Euro/Sweden EURSEK= 10.1147 10.0604 +0.54% -3.39% +10.1245 +10.0567