* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh
By Saikat Chatterjee
LONDON, Jan 28 (Reuters) - The euro fell to a 33-month low
against the Swiss franc on Tuesday as concerns about the
economic fallout from the coronavirus outbreak in China sent
investors scurrying to the relative shelter of perceived
currency market safe-havens.
Though global markets stabilised somewhat after Monday's
selloff, there was a strong undercurrent of risk aversion in
currency markets with the Australian dollar leading losers and
the dollar strengthening to a 8-week high against its rivals.
"Uncertainty on the virus news front is the name of the game
in the markets and markets don't like uncertainty," said Lee
Hardman, a currency strategist at MUFG in London.
The euro/Swiss franc cross EURCHF=EBS , a pair highly
correlated to risk sentiment fell 0.1% to 1.0666 francs per
euro, its lowest since April 2017.
It has already fallen 1.6% so far in January and is on track
for its biggest monthly drop since April 2019.
Global stocks and oil prices have tumbled in recent days on
fears the virus could do further damage to China's already
weakened economy, an engine of global growth. MKTS/GLOB
But larger moves were subdued, with the U.S. dollar
comfortably holding on to its previous gains ahead of the start
of a two-day U.S. Federal Reserve meeting later on Tuesday, with
policymakers largely expected to reiterate that interest rates
will remain on hold this year. "The market is taking a step back from the selloff earlier
due to the virus concerns though the dollar is unlikely to
weaken substantially as there is safe-haven demand for the
greenback," said Morten Lund, a senior FX strategist at Nordea.
Against a basket of other currencies .DXY , the dollar rose
0.1% to 98.01, its highest level since early December and taking
its gains so far this month to 1.7%.
The Australian and New Zealand dollars AUD=D3 NZD=D3 led
the losers against the greenback, falling 0.2% and 0.1%
respectively, although both were off early lows.
Investors' attention was firmly focused on the Chinese
currency in the offshore market with mainland markets shut for
holidays this week. The Chinese currency erased earlier gains
and was broadly flat at 6.9860 yuan per dollar.
Stability in the offshore yuan after a recent drop provided
some calm to nervous currency markets. The offshore yuan
CNH=D3 has weakened more than 2% in less than a week against
the dollar.
Elsewhere, the yen JPY=EBS held steady at 108.97 per
dollar, close to its strongest level since Jan. 8.
Japan's currency has risen against the greenback for the
last five trading sessions due to the growing risk aversion.
The Norwegian crown was another significant laggard
NOK=D3 , weakening 0.3% versus the dollar as falling oil prices
and rising political uncertainty further dented sentiment.
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EURCHF https://tmsnrt.rs/2tVM9Ut
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