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FOREX-Dollar dips after previous gains amid COVID-19, election uncertainty

    * Dollar gives up early gains, euro marginally higher
    * FX markets in wait-and-see mode before U.S. election
    * Sterling gains as Brexit trade deal talks continue
    * Graphic: World FX rates in 2020 tmsnrt.rs/2RBWI5E

 (Adds new comments, FX table, updates prices, changes byline, dateline; previous LONDON)
    By Gertrude Chavez-Dreyfuss
    NEW YORK, Oct 27 (Reuters) - The U.S. dollar slipped on Tuesday as investors took some profits after
the previous session's gains that also saw a sell-off in equities, while worries about a second
coronavirus wave and uncertainty ahead of the U.S. election persisted.
    The greenback fell against the currencies that benefit mostly from higher risk appetite such as the
euro, sterling, and commodity-linked currencies rose.
    Monday saw the steepest stock market sell-off in a month and a bond rally, but foreign exchange market
activity has remained relatively muted, with price moves on Tuesday limited. 
    "The uncertainty in the economic outlook has not changed one bit," said Edward Moya, senior market
analyst, at OANDA in New York, but noted that some positive stories on the U.S. earnings front.
    "Markets are becoming more convinced a blue wave is happening," Moya said, referring to a victory of
the Democratic Party in the Senate, House of Representatives, and the White House in next Tuesday's
election.
    "The prospects of a Biden administration is probably more positive for the fight against COVID," he
added. 
    Polls give Democrat Joe Biden a solid lead but the contest is much tighter in battleground states that
could decide the outcome.
    That said, analysts warned investors were clearly cautious after the United States, Russia and France
all hit new daily records for COVID-19 infections. They said prices were not moving much because of a
reluctance to build positions before the U.S. presidential election on Nov. 3.
    After initially falling, the euro was up 0.2% at $1.1826 in late morning trading.
    The dollar index, which measures the greenback against a basket of major currencies, weakened 0.2% to
92.92.
    The greenback fell 0.3% versus the yen to 104.53 yen, and was little changed against 0.9074
.
    "Many sources of uncertainty are still preventing clearer trends from emerging," UniCredit analysts
said in a research note. 
    "The impasse on both U.S. budget talks and Brexit negotiations, as well as the implications of rising
COVID-19 infections on 4Q20 GDP growth, play in favor of more euro-dollar and sterling-dollar
stabilization for now," they said, pointing to levels of "just above $1.18 and $1.30, respectively."
    The usually risk-sensitive Australian and New Zealand dollars gained.
    The yuan weakened after Reuters reported that China's central bank had neutralised the
counter-cyclical factor in its daily yuan midpoint fixing in a move to let the fixing more closely reflect
actual market moves.
    The move is typically positive for the dollar, said Stephen Innes, chief market strategist, at online
brokerage Axi.
    "Such a move means dollar/yuan should generally fix higher. The removal of the element would imply
greater FX flexibility," he added. 
    The dollar was last flat 0.1% at 6.7039 yuan <.  
    The European Central Bank, meanwhile, convenes on Thursday for its monetary policy meeting, but
analysts say market reaction will be limited.
    ========================================================
    Currency bid prices at 10:45AM (1445 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar                  $1.1822        $1.1810     +0.11%         +5.46%      +1.1839     +1.1797
 Dollar/Yen                   104.5150       104.8500    -0.21%         -3.67%      +104.8800   +104.5900
 Euro/Yen                     123.55         123.80      -0.20%         +1.31%      +123.9900   +123.5100
 Dollar/Swiss                 0.9077         0.9078      -0.02%         -6.21%      +0.9097     +0.9062
 Sterling/Dollar              1.3033         1.3022      +0.10%         -1.72%      +1.3058     +1.3001
 Dollar/Canadian              1.3174         1.3213      -0.25%         +1.45%      +1.3211     +1.3157
 Aussie/Dollar                0.7130         0.7123      +0.11%         +1.63%      +0.7142     +0.7116
 Euro/Swiss                   1.0731         1.0718      +0.12%         -1.12%      +1.0748     +1.0718
 Euro/Sterling                0.9068         0.9066      +0.02%         +7.26%      +0.9085     +0.9061
 NZ                           0.6715         0.6678      +0.57%         -0.19%      +0.6716     +0.6675
 Dollar/Dollar                                                                                  
 Dollar/Norway                9.1720         9.2450      -0.81%         +4.54%      +9.2455     +9.1530
 Euro/Norway                  10.8455        10.9140     -0.63%         +10.24%     +10.9290    +10.8240
 Dollar/Sweden                8.7235         8.7418      -0.12%         -6.67%      +8.7632     +8.7072
 Euro/Sweden                  10.3140        10.3260     -0.12%         -1.48%      +10.3422    +10.3058
 
    
 (Reporting by Gertrude Chavez-Dreyfuss; Additoional reporting by Tommy Wilkes in London)
  
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