FOREX-Japanese yen gains as virus caution weighs

* Dollar index flat, yen at 2-week high
* Yuan dips but stays near 4-month high
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

By Iain Withers
LONDON, July 10 (Reuters) - The dollar paused on Friday as
concerns about a surge in coronavirus infections in the United
States and elsewhere supported the safe haven Japanese yen,
while risk-sensitive currencies lost ground.
More than 60,000 new COVID-19 cases were reported across the
United States on Thursday, the largest single-day tally by any
country in the global pandemic so far, discouraging some
American consumers from returning to public spaces. Some Asia Pacific cities that had appeared to have contained
the disease, such as Tokyo, Hong Kong and Melbourne, have seen
alarming new spikes in infections, dampening the mood further.
The caution helped to drive the safe-haven yen up by 0.4% to
a two-week high of 106.81 per dollar. JPY=
The dollar gained against most other currencies, although
the strong performance of the yen meant its index was last
broadly flat. =USD
Among the currencies to lose ground were the British pound,
Australian dollar and Norwegian crown, although their losses
were tempered in early European trading hours. GBP=D3 AUD-D3
NOK=
"Currency pairs across the board are trading risk-off," said
Lee Hardman, currency analyst at MUFG.
"The Japanese yen has been trading within a very tight
trading range throughout the crisis. We're definitely back
towards the bottom of that range."
The Chinese yuan was down about 0.2% at 7.0098 yuan per
dollar CNH= , having touched a near-four-month high of 6.9808
on Thursday.
The Chinese currency has gained almost 1% this week,
supported by hopes of capital inflows as share prices rebounded
after Beijing indicated it wants a healthy bull market.
Higher China debt yields are also attracting foreign
capital, said Dmitriy Vlasov, portfolio adviser at East Capital
in Hong Kong.
"We have had quite a big inflows in the fixed income markets
as interest rate differentials are also leading to the
appreciation of the yuan."