* EU leaders in fourth day of negotiations on recovery package
* U.S. dollar index falls to 6-week low
* Trump signs off on plan to seek $1 trillion more in virus relief
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
(Recasts, adds comment, updates prices)
By Gertrude Chavez-Dreyfuss
NEW YORK, July 20 (Reuters) - The euro climbed to its highest in more than four months against the
U.S. dollar on Monday on hopes that the European Union would agree on a recovery fund for economies in the
region hit by the COVID-19 pandemic.
The fund is expected to be around 750 billion euros ($857.93 billion), of which 390 billion euros
could be offered as grants.
European Union leaders said they were cautiously optimistic that agreement on a massive stimulus plan
for their coronavirus-blighted economies was within reach, though tensions among them remained high after
days of squabbling. "We can't help but notice how bullish the street is when it comes to euro/dollar forecasts, and so we
have to wonder if the eventual confirmed deal headlines prompt a 'buy the rumor/sell the fact' type of
market reaction," said Erik Bregar, head of FX strategy at Exchange Bank of Canada in Toronto.
Positive news about a potential COVID-19 vaccine also added to overall market optimism, lifting
currencies that thrive in times of increased risk appetite, such as the Australian and New Zealand
dollars.
An experimental coronavirus vaccine being developed by AstraZeneca and Oxford university was safe and
produced an immune response in early-stage clinical trials, data showed on Monday, keeping alive the hope
it could be in use by the end of the year. In midday trading, the euro was last up 0.1% at $1.1442, after earlier hitting a more than four-month
high of $1.1467 EUR=EBS .
Analysts said the smaller the amount of grants from the EU fund, the more the euro would fall.
If EU leaders agree on a recovery fund, that would boost confidence in the euro regardless of the
numbers in the deal, said Mike Bell, global market strategist at J.P. Morgan Asset Management.
The U.S. dollar index USD= fell 0.1% to 95.863 after sliding to a six-week low hit earlier in the
session. Its gains, though, remain capped by expectations of more stimulus from Europe and from the United
States.
U.S. President Donald Trump signed off on an effort to seek an additional $1 trillion in coronavirus
economic relief, Treasury Secretary Steve Mnuchin said on Monday, as Republicans laid out their initial
proposal for talks with Democrats. That said, the U.S. Congress is bracing for a battle on the proposed stimulus bill that could boost
safe-haven bids for the dollar. The dollar rose 0.2% versus the yen to 107.25 JPY=EBS and was up 0.1% against the Swiss franc to
0.9396 franc CHF=EBS .
The Australian and New Zealand dollars, however, gained against the greenback to US$0.7004 AUD=D3
and US$0.6562 NZD=D3 .
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Currency bid prices at 12:33PM (1633 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR= $1.1436 $1.1426 +0.09% +2.02% +1.1467 +1.1403
Dollar/Yen JPY= 107.2300 106.9900 +0.22% -1.50% +107.5200 +107.0200
Euro/Yen EURJPY= 122.62 122.30 +0.26% +0.55% +122.9700 +122.1900
Dollar/Swiss CHF= 0.9397 0.9384 +0.14% -2.90% +0.9410 +0.9374
Sterling/Dollar GBP= 1.2646 1.2565 +0.64% -4.62% +1.2658 +1.2519
Dollar/Canadian CAD= 1.3537 1.3576 -0.29% +4.24% +1.3600 +1.3529
Australian/Doll AUD= 0.7005 0.6995 +0.14% -0.23% +0.7016 +0.6974
ar
Euro/Swiss EURCHF= 1.0746 1.0723 +0.21% -0.98% +1.0776 +1.0721
Euro/Sterling EURGBP= 0.9037 0.9088 -0.56% +6.90% +0.9138 +0.9032
NZ NZD= 0.6564 0.6556 +0.12% -2.55% +0.6573 +0.6540
Dollar/Dollar
Dollar/Norway NOK= 9.2551 9.2928 -0.41% +5.43% +9.3228 +9.2416
Euro/Norway EURNOK= 10.5848 10.6240 -0.37% +7.59% +10.6353 +10.5709
Dollar/Sweden SEK= 8.9816 9.0334 -0.53% -3.91% +9.0640 +8.9734
Euro/Sweden EURSEK= 10.2742 10.3285 -0.53% -1.86% +10.3395 +10.2700
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Euro jumps to 4-month high https://tmsnrt.rs/3fN2M7r
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