* Euro hits nearly 2-year high vs dollar
* Yuan recovers to trade around 7 per dollar
* U.S. jobless claims rise, add to dollar bearishness
* U.S. coronavirus cases continue to surge
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
(Updates to midafternoon, changes byline)
By Chuck Mikolajczak
NEW YORK, July 23 (Reuters) - The dollar slumped to its
lowest in nearly two years on Thursday, as investors continued
to sell the greenback on expectations a surge in coronavirus
cases will make it difficult for the U.S. economy to outperform
its peers.
By contrast, the euro rose to its highest since early
October 2018 after breaching the technically important $1.16
level on Wednesday and was up for a fifth straight day against
the dollar, still basking in the glow of the European recovery
fund approved earlier this week.
"Speculators are pretty underweight a lot of the G10
currencies so there is room for this momentum move to keep
going," said Erik Nelson, currency strategist at Wells Fargo
Securities in New York.
"The biggest risk that it stops and the dollar starts to
regain its legs is equities, if the equity rally really starts
to falter and we see a big move lower then all of a sudden
dollar strength is going to come back very quickly."
A rise in U.S. jobless claims last week, for the first time
in four months, also added to pressure on the dollar, as a
persistent increase in COVID-19 cases has put an apparent
recovery in the labor market on stall speed and dampened
consumer demand.
U.S. coronavirus cases topped 4 million on Thursday, with
over 2,600 new cases every hour on average, the highest rate in
the world, according to a Reuters tally. In afternoon trading, the dollar index was down 0.3% at
94.725 =USD , after hitting its lowest since late September
2018. It has lost nearly 8% since its March 20 peak, when a
global dollar funding crunch saw a surge in demand. The index is
down 1.3% on the week and on pace for its fifth straight weekly
decline.
The dollar briefly strengthened after U.S. Treasury
Secretary Steven Mnuchin said the U.S. government will protect
the stability of the currency. White House officials and U.S.
Senate Republican leaders also continued to work towards a
proposal for a new round of aid to buttress the economy.
Against the Japanese yen, the dollar was down 0.37% at
106.75 yen JPY=EBS .
The U.S. currency was also down 0.46% against the Swiss
franc at 0.9252 franc CHF=EBS . Earlier it dropped to a more
than four-month low.
The euro EUR=EBS was up 0.34% at $1.1609, hitting a fresh
21-month high of $1.1601 hit earlier on Wednesday.
The Australian dollar AUD=D3 retreated from a 15-month
peak against the greenback to around US$0.7107, down 0.46%,
while the New Zealand dollar NZD=D3 fell 0.41% to US$0.6636,
below Wednesday's six-month top of US$0.6678.
Elsewhere, China's offshore yuan recovered losses somewhat
from an earlier slide against the U.S. dollar, which was last
down 0.1% at 7.0113 yuan CNH=EBS .
China said the U.S. move on Tuesday to close its Houston
consulate this week had "severely harmed" relations and warned
it "must" retaliate, without further details. ========================================================
Currency bid prices at 3:00PM (1900 GMT)
Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid
Previous Change
Session
Euro/Dollar EUR= $1.1607 $1.1568 +0.34% +3.54% +1.1626 +1.1541
Dollar/Yen JPY= 106.7300 107.1400 -0.38% -1.96% +107.2200 +106.7400
Euro/Yen EURJPY= 123.89 123.97 -0.06% +1.59% +124.2400 +123.7200
Dollar/Swiss CHF= 0.9253 0.9295 -0.45% -4.39% +0.9301 +0.9246
Sterling/Dollar GBP= 1.2741 1.2732 +0.07% -3.91% +1.2759 +1.2674
Dollar/Canadian CAD= 1.3388 1.3415 -0.20% +3.10% +1.3427 +1.3351
Australian/Doll AUD= 0.7109 0.7138 -0.41% +1.25% +0.7161 +0.7091
ar
Euro/Swiss EURCHF= 1.0741 1.0753 -0.11% -1.02% +1.0762 +1.0716
Euro/Sterling EURGBP= 0.9109 0.9084 +0.28% +7.75% +0.9124 +0.9082
NZ NZD= 0.6634 0.6661 -0.41% -1.51% +0.6689 +0.6629
Dollar/Dollar
Dollar/Norway NOK= 9.2123 9.1389 +0.80% +4.94% +9.2362 +9.1055
Euro/Norway EURNOK= 10.6957 10.5970 +0.93% +8.72% +10.7160 +10.5523
Dollar/Sweden SEK= 8.8530 8.8549 +0.13% -5.29% +8.9113 +8.8304
Euro/Sweden EURSEK= 10.2787 10.2657 +0.13% -1.82% +10.2880 +10.2420
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Dollar's performance in 2020 https://tmsnrt.rs/2E8xdqJ
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