FOREX-Virus containment hopes support Asian currencies; kiwi soars

* Asian currencies firm, but moves slight
* Strong U.S. dollar holds AUD from further gains
* Kiwi jumps after RBNZ drops easing bias
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E

By Tom Westbrook
SINGAPORE, Feb 12 (Reuters) - Trade-exposed Asian currencies
edged ahead on Wednesday, buoyed by optimism that the spread of
coronavirus had slowed, while the kiwi leapt after the central
bank dropped its easing bias.
Across mainland China there were 2,015 new confirmed
infections as of Tuesday, the lowest daily rise since Jan. 30.
China's senior medical adviser also said the outbreak might be
over by April. That news had currency markets stabilising after a steep
selldown of China-exposed assets. The U.S. dollar, which had
soaked up safe-haven flows as worries about the virus coincided
with strong economic data, handed back some gains. EMRG/FRX
The Australian dollar, sensitive to China's fortunes because
of Australia's commodity-driven export profile, firmed 0.3% to
$0.6728 AUD=D3 . China's yuan CNY= was modestly stronger and
the safe-haven Japanese yen JPY= was a little softer. CNY/
"Two things are giving cause for optimism," said Vishnu
Varathan, head of economics at Mizuho Bank in Singapore. "The
rate of infections is slowing and the number of recoveries is
going up faster than deaths," he said. "Markets have pulled back
from the verge of the cliff...they've avoided a free fall."
But levels have stabilised rather than recovered, pointing
to plenty of caution remaining. MKTS/GLOB
More than 1,100 people have died from the epidemic in China,
about 2% of people infected. The economy has also been upended,
with factory closures hitting supply chains from car makers to
tech firms.
Oil prices, a barometer of global energy demand and so of
growth, remain nearly a fifth lower than they were before the
outbreak. O/R
The currencies of oil exporters such as Canada and Norway
have been hammered, with the krone NOK= shedding 5% this year
and the loonie CAD=D3 hitting a four-month low on Monday.
Despite rising on Wednesday, the tourism-sensitive Thai baht
THB= is down 4% for the year as is the Australian dollar,
which briefly touched a decade-low this week.
Recession fears in Europe also dragged the euro EUR= to a
four-month low overnight, though it has since recovered by about
0.2% to $1.0916. The pound GBP= sat at its highest in a week
after fourth-quarter growth beat sluggish forecasts.
"The main impact of coronavirus for Europe is growth," said
Steve Englander, head of global G10 FX research at Standard
Chartered.
"The euro area started the year with low growth and an ECB
largely out of policy options...(a) bad scenario could see an
extension of recent moves and EUR/USD may head towards the
$1.04/05 lows of the European debt crisis."
Elsewhere, the New Zealand dollar NZD=D3 jumped 0.8% to
$0.6462, its sharpest rise in two months, after the central bank
removed the chance of a rate cut from its forward projections.
NZD/
It forecast a short hit from the coronavirus and predicted
national growth would pick up in the second half. "The easing bias is gone and we're back to neutral," said
Westpac FX analyst Imre Speizer. "It's the clearest indication
that the easing cycle is probably over," he said, unless a deep
hit from the coronavirus prompts a change of heart.

(Editing by Richard Pullin and Jacqueline Wong)