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FOREX-Dollar falls as improving sentiment boosts riskier currencies

Published 22/02/2021, 11:37 am
© Reuters.
EUR/USD
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USD/CHF
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AUD/USD
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NZD/USD
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BTC/USD
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* Graphic: World FX rates https://tmsnrt.rs/2RBWI5E

* Aussie and kiwi rise early against dollar

* British pound up as exit from lockdown looms on horizon

* Rising Treasury yields to slow dollar's decline

By Stanley White

TOKYO, Feb 22 (Reuters) - The U.S. dollar fell to a three-year low against its Australian counterpart and teetered near three-year low against the British pound as progress in curbing coronavirus infections boosted sentiment for riskier assets.

The greenback also slipped toward a three-year low against the New Zealand dollar as traders sought currencies with close ties to the global commodities trade due to an improving economic outlook.

The U.S. currency, which is often considered a safe asset during times of uncertainty, is likely to fall further as more investors focus on economic recovery once the worst of the coronavirus pandemic passes.

"Commodity currencies and the pound are particularly strong against the dollar, and this trend looks set to continue," said Yukio Ishizuki, foreign exchange strategist at Daiwa Securities.

"Britain's vaccination programme is making a lot of progress. Economic activity is gradually returning to normal in many places, which puts some pressure on the dollar."

The Australian dollar AUD=D3 hit $0.7892, its highest since March 2018 while the New Zealand currency NZD=D3 rose to $0.7315, its strongest since April 2018.

Vaccine rollouts will ease risks to Australia's economy over the year, ratings agency Fitch said on Monday when it maintained the country's top AAA credit rating, albeit with a negative outlook. euro EUR=D3 last traded at $1.2124

The British pound GBP=D3 bought $1.4030, close to a three-year high.

Against the yen JPY=D3 , the dollar held steady at 105.45

Australia on Monday began its mass COVID-19 vaccine programme as the country looked set to report no local cases for the third straight day, which gave the Aussie a boost. is also in focus because British Prime Minister Boris Johnson will plot a path out of coronavirus lockdowns later on Monday, aided by one of the fastest vaccine rollouts in the world. net short positioning fell last week to $29.09 billion, which is the lowest level since mid-December, according to calculations by Reuters and Commodity Futures Trading Commission data.

U.S. dollar net shorts have fallen for four straight weeks, which shows that there are still some investors who are optimistic about the greenback.

Long-term Treasury yields have been rising recently, and the United States has also improved its response to the coronavirus, which will lend the dollar some mild support, Daiwa's Ishizuki said.

In the cryptocurrency market, bitcoin BTC=BTSP eased slightly to $57,090, but was still near a record high as the digital asset gains more mainstream acceptance.

Ether ETH=BTSP , a rival cryptocurrency, fell to $1,918.

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Currency bid prices at 0014 GMT Description

RIC

Last

U.S. Close Pct Change

YTD Pct

High Bid

Low Bid

Previous

Change

Session

Euro/Dollar

EUR=EBS

$1.2124

$1.2118

+0.04%

-0.78%

+1.2129

+1.2110 Dollar/Yen

JPY=D3

105.4550

105.4900

+0.02%

+2.15%

+105.6150 +105.5050 Euro/Yen

EURJPY=

127.86

127.75

+0.09%

+0.74%

+127.9800 +127.7000 Dollar/Swiss

CHF=EBS

0.8966

0.8965

+0.04%

+1.37%

+0.8974

+0.8968 Sterling/Dollar GBP=D3

1.4030

1.4001

+0.18%

+2.66%

+1.4030

+1.4013 Dollar/Canadian CAD=D3

1.2603

1.2619

-0.12%

-1.02%

+1.2617

+1.2598 Aussie/Dollar

AUD=D3

0.7884

0.7868

+0.20%

+2.49%

+0.7891

+0.7864 NZ

NZD=D3

0.7305

0.7297

+0.10%

+1.71%

+0.7316

+0.7292 Dollar/Dollar

All spots FX= Tokyo spots AFX= Europe spots EFX= Volatilities FXVOL= Tokyo Forex market info from BOJ TKYFX

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ World FX rates

https://tmsnrt.rs/2RBWI5E

^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>

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