* Dollar makes modest but broad gains after Trump positive test
* Yen leaps to one-week high, +1% vs AUD
* Analysts say campaign likely to face disruption
* Graphic: World FX rates in 2020 https://tmsnrt.rs/2RBWI5E
By Tom Westbrook
SINGAPORE, Oct 2 (Reuters) - The dollar rose and the safe-haven yen made its sharpest jump in more than a month on Friday after U.S. President Donald Trump said he tested positive for COVID-19, just a month ahead of the Nov. 3 presidential election.
The news could cause a new wave of market volatility heading into the election. Trump, 74, is at high risk for the deadly virus both because of his age and because he is considered overweight. greenback gained about 0.6% on the risk-sensitive Australian dollar and the yen streaked ahead even further, gaining half a percent on the dollar to a one-week high of 104.95, and rising more than 1% on the Aussie.
Trump said he and first lady Melania Trump had both tested positive and would begin a quarantine process immediately.
"The president of the United States has got a disease which kills people. People are de-risking because of that," said Chris Weston, head of research at Melbourne brokerage Pepperstone.
The euro EUR= fell 0.2% to $1.1725. Commodities and U.S. stock futures also tumbled. MKTS/GLOB
The Australian dollar AUD=D3 was last down 0.6% at $0.7141 and the kiwi NZD=D3 down 0.3% at $0.6629. Against a basket of six major currencies =USD the dollar rose 0.1% to 93.824.
Weston and other analysts said Trump's diagnosis could hurt his campaign, but that the next implications for markets were not clear, and would depend on Trump's health, how far the virus has spread amongst top U.S. politicians and on voters' response.
"As far as we know Trump is not gravely ill. It is possible that by the time we reach New York trading that markets will have calmed down," said Yako Sero, strategist at Sumitomo Mitsui Trust Bank in Tokyo.
"However, this does damage Trump's ability to campaign and time is running out before the election."
Sterling, already battered by Brexit turmoil on Thursday, hung on against the dollar but was punished against the yen. The pound GBP= fell 0.1% to $1.2872 and 0.5% to 135.22 yen.
JITTERS
Even before Trump's test, investors had already been on edge in Asia on signs that a hoped-for U.S. fiscal stimulus package was stalled in Washington, and were nervously awaiting U.S. jobs data due at 1230 GMT for a read on the economy.
House Speaker Nancy Pelosi and Treasury Secretary Steven Mnuchin have so far failed to bridge what Pelosi described as differences over dollars and values to secure the Congressional agreement needed to pass a relief bill. hiring likely increased by 850,000 jobs in September, according to a Reuters survey of economists, a slowdown from the previous month. concerns are also growing that coronavirus infection rates are climbing in Europe and the United States.
Madrid will become the first European capital to go back into lockdown in coming days to fight a steep surge in cases. record increase in new cases in Wisconsin on Thursday fanned fears of hospitals there being overwhelmed and the President's infection only highlights its prevalence. this does say is that the risk of the virus picking up is still quite real," said Bank of Singapore FX analyst Moh Siong Sim. "The U.S. infection rate is not going down anymore. This reminds people that the virus is still around."