FOREX-Solid U.S. data and virus optimism supports dollar

* U.S. dollar near two-month high
* Yen soft, Aussie firm on virus optimism
* Sing dollar nurses losses
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

By Tom Westbrook
SINGAPORE, Feb 6 (Reuters) - The U.S. dollar stood tall on
Thursday, supported by firm domestic data and hopes the
coronavirus' economic impact could be limited, even as the human
toll continued to climb.
Another 73 people on the Chinese mainland died on Wednesday
from the outbreak, the highest daily increase so far, bringing
the total death toll to 563. Infections stand at 28,018. Drugmakers and the World Health
Organization played down press reports about progress toward
finding treatments, which had boosted traders' confidence.
Amid the uncertainty about the virus, currency investors
also turned their attention to traditional market drivers,
specifically U.S. private payrolls, which posted their biggest
jump in nearly four years, while a separate report showed a
service sector pickup. That helped the greenback higher and it drifted north in
morning trade to a two-week high of 109.87 Japanese yen JPY= .
It sat at $1.0994 per euro, just below a one-week peak
touched overnight against the common currency EUR= , while the
Australian dollar AUD=D3 inched ahead by 0.1%.
"This is a market that was just wanting to go higher, it
just needs a reason," said Chris Weston, head of research at
Melbourne brokerage Pepperstone.
"It's like a jack-in-the-box, with a lid that is just
waiting to spring up," he said.
"If you've got investable capital, you want to try and get
it as far away from ground zero as you possibly can, and I think
that's why you're seeing relative outperformance from markets
which had less exposure."
Overnight the S&P 500 .SPX made a fresh record closing
high and the dollar hit a two-month high against a basket of its
peers .DXY . .N MKTS/GLOB
Yet plenty of caution remains elsewhere, with oil prices
stabilising but making only a cautious recovery with the size of
the expected hit to demand still growing. O/R
The virus has disrupted air travel, driven holiday
cancellations, factory closures and production cuts.
"Places where the optimism isn't being felt include Thailand
and Singapore, with room for easier monetary policy being
explored and Korea, where it's way too real to relax," said Kit
Juckes, an analyst at Societe Generale.
The Thai baht THB=TH and Korean won KRW= have both been
heavily sold in recent weeks, each giving up 2% since Jan. 20
and both soft in morning trade on Thursday.
The Singapore dollar SGD= licked its wounds after posting
its steepest drop in two years on Wednesday when the central
bank said the currency has room to weaken as the virus weighs on
the economy. Elsewhere the British pound GBP= sat at $1.2991, while the
Swedish krona jumped against the euro EURSEK= after a better
than expected manufacturing survey sent it 0.5% higher.
The Hong Kong dollar HKD=D3 hit an almost three-year high
overnight as attractive interest rates in the city attract
deposits.