FOREX-Safe-haven dollar lifted by rise in coronavirus cases

(New throughout)
By Kate Duguid
NEW YORK, June 17 (Reuters) - The U.S. dollar was slightly
higher on Wednesday afternoon as evidence of a surge in
coronavirus cases in some U.S. states and in Beijing sent
investors into safe-haven assets.
The dollar index =USD was up 0.140% to 97.121 and stronger
versus the euro EUR= by 0.25% to $1.124. Against other
traditional safe-havens the dollar was weaker, down 0.28%
against the Japanese yen JPY= and down 0.23% against the Swiss
france CHF= .
"Mixed risk-taking levels, largely driven by a surge in
virus cases in several U.S. states, and in Beijing, have
prompted some save-haven dollar buying," wrote analysts at
Action Economics.
On Wednesday a record number of cases were reported in
Oklahoma. Florida reported over 2,600 new cases and Arizona more
than 1,800 - the second-highest daily increase for both states.
A day earlier, six states reported record increases in cases,
including Texas, Nevada and Oregon. Earlier Wednesday Beijing cancelled scores of flights, shut
schools and blocked off some neighborhoods as it ramped up
efforts to contain a coronavirus outbreak that has fanned fears
of wider contagion. Gains in the dollar were capped by some bullish sentiment
after Federal Reserve Chair Jay Powell in remarks before U.S.
lawmakers beat the drum for more government aid to bolster the
domestic economy.
"We at the Fed need to keep our foot on the gas until we are
really sure we are through this, and that's our intention, and I
think you may find that there's more for you to do as well,"
Powell said in testimony via a video link to the U.S. House of
Representatives Financial Services Committee. The dollar index has recovered from a three-month low last
week, but the outlook for the currency looks weak as U.S.
economic data has begun to recover and stock indexes have
soared.
"The broad dollar outlook remains negative as investors are
cutting back on some of the extreme tail risk hedging bets in
the markets, some of which were buying dollars," said Ilan
Solot, a currency markets strategist at Brown Brothers Harriman.