February 7, 2020 / 3:59 PM / 18 days ago

FOREX-Dollar drops vs yen as virus fears outweigh strong U.S. jobs data

    * U.S. non-farm payrolls show 225,000 job gains
    * Euro hurt by poor German data, worst week since November 
    * Coronavirus fears keep sentiment fragile, yen gains
    * Death toll from virus reaches 637
    * GRAPHIC-World FX rates in 2019: tmsnrt.rs/2egbfVh

 (Recasts, adds new comment, U.S. data, FX table, updates prices)
    By Gertrude Chavez-Dreyfuss
    NEW YORK, Feb 7 (Reuters) - The dollar fell against the safe-haven yen on Friday as nagging fears
about the latest coronavirus that broke out in China a few weeks ago overshadowed an overall strong U.S.
non-farm payrolls report.
    The yen rose after four straight days of selling that was spurred by investors being encouraged by the
efforts from the Chinese government to contain the virus and limit its economic fallout.
    The dollar, however, barely budged against the yen after robust U.S. non-farm payrolls numbers for
January.
    Data showed nonfarm payrolls increased by 225,000 jobs last month, with employment at construction
sites increasing by the most in a year amid milder-than-normal temperatures. Economists polled by Reuters
had forecast payrolls would rise by 160,000 jobs in January.
    "The gains in the dollar right after the data can best be described as tepid," said Bipan Rai, North
American head of FX strategy, at CIBC Capital Markets in Toronto.
    "But the data was quite robust, with the number of jobs added to the economy, and the fact that we're
still growing, but at probably a much more subdued pace than what the market had anticipated," he added.
    In late morning trading, the dollar dropped 0.4% against the yen to 109.61 yen and was little
changed against the Swiss franc at 0.9750 franc. 
     The dollar index, which measures the currency against a basket of rivals, edged lower to 98.47
.
    Brian Daingerfield, head of G10 FX strategy at Natwest Markets in Stamford, Connecticut said the
coronavirus has injected a lot of uncertainty in the market, as investors wondered whether the improvement
in global data in January can be sustained.
    The death toll in mainland China reached 637 on Friday, with a total of 31,211 cases, WHO chief Tedros
Adhanom Ghebreyesus said on Friday in Geneva. The virus has spread around the world, with 320 cases in 27
countries and regions outside mainland China, a Reuters tally of official statements shows.
    The euro, meanwhile, fell to its lowest since October on Friday after German industrial output
recorded its biggest decline in a decade in December.
    The single European currency dropped to as low as fell as low as $1.0949, and was last down
0.1% and has now lost 1.2% since Monday, putting it on track for its worst week since November. 
    The offshore yuan slipped 0.4% to 7.007 yuan per dollar, though it was still set for a small
gain this week thanks to stimulus from China's central bank and Beijing's announcement of tariff cuts on
U.S. imports.
    The Australian dollar, often seen as a proxy for China, weakened 0.7% to US$0.6679, its lowest
since October, after the Reserve Bank of Australia slashed growth forecasts in its quarterly economic
outlook.
    
    ========================================================
    Currency bid prices at 10:28 AM (1528 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar      EUR=        $1.0958        $1.0980     -0.20%         -2.25%      +1.0985     +1.0949
 Dollar/Yen       JPY=        109.6200       109.9900    -0.34%         +0.70%      +110.0200   +109.5400
 Euro/Yen         EURJPY=     120.15         120.78      -0.52%         -1.48%      +120.8000   +120.1300
 Dollar/Swiss     CHF=        0.9757         0.9744      +0.13%         +0.82%      +0.9770     +0.9740
 Sterling/Dollar  GBP=        1.2939         1.2928      +0.09%         -2.41%      +1.2958     +1.2922
 Dollar/Canadian  CAD=        1.3307         1.3284      +0.17%         +2.47%      +1.3319     +1.3280
 Australian/Doll  AUD=        0.6677         0.6730      -0.79%         -4.90%      +0.6736     +0.6663
 ar                                                                                             
 Euro/Swiss       EURCHF=     1.0692         1.0702      -0.09%         -1.46%      +1.0709     +1.0680
 Euro/Sterling    EURGBP=     0.8469         0.8492      -0.27%         +0.18%      +0.8497     +0.8462
 NZ               NZD=        0.6410         0.6456      -0.71%         -4.84%      +0.6463     +0.6404
 Dollar/Dollar                                                                                  
 Dollar/Norway    NOK=        9.2818         9.2171      +0.70%         +5.74%      +9.2959     +9.2168
 Euro/Norway      EURNOK=     10.1710        10.1228     +0.48%         +3.39%      +10.1974    +10.1184
 Dollar/Sweden    SEK=        9.6395         9.6221      -0.04%         +3.12%      +9.6514     +9.6083
 Euro/Sweden      EURSEK=     10.5625        10.5672     -0.04%         +0.89%      +10.5844    +10.5357
 
    
 (Reporting by Gertrude Chavez-Dreyfuss; Additional reporting by Karen Brettell in New York and Tommy
Wilkes in London)
  
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