July 23, 2020 / 2:37 PM / 23 days ago

FOREX-U.S. dollar skids to 4-month low; euro continues rise

    * Euro retreats from nearly 2-year high; still up on the day
    * Yuan recovers to trade around 7 per dollar
    * U.S. jobless claims rise, add to dollar bearishness
    * U.S. coronavirus cases surge again
    * Graphic: World FX rates in 2020 tmsnrt.rs/2RBWI5E

 (Recasts, adds new comment, FX table, U.S. data, updates prices, changes byline, dateline; previous
LONDON)
    By Gertrude Chavez-Dreyfuss
    NEW YORK, July 23 (Reuters) - The dollar dropped to a more than four-month low on Thursday, as
investors continued to sell the buck on expectations the U.S. economy will likely underperform its peers
in the developed world with the surge in new coronavirus cases.
    By contrast, the euro held gains after hitting a nearly two-year high above $1.16 on Wednesday.
    A rise in U.S. jobless claims in the latest week, the first time in four months, also added to the
dollar's woes, as a persistent increase in COVID-19 cases has derailed the labor market and dampened
consumer demand.
    "There has been a turn in dollar sentiment," said Marc Chandler, chief market strategist, at
Bannockburn Forex in New York. "Two months ago, my dollar bearishness was not a consensus view. I think
now it has become pretty much consensus."
    He added that Friday's global manufacturing data would likely show that Europe seems to be "getting
better than the U.S., with a lot of the signs pointing to a slowing in the country."
    U.S. coronavirus cases approached 4 million on Thursday, with over 2,600 new cases every hour on
average, the highest rate in the world, according to a Reuters tally.
    With over 143,000 deaths, or 4.4 fatalities per 10,000 people, the United States ranks sixth globally
for the highest deaths per capita. It is exceeded by the United Kingdom, Spain, Italy, Chile and France.
    In midmorning trading, the index that measures the dollar against major currencies was down 0.1% at
94.934, after hitting its lowest since March 9. The dollar index has lost nearly 8% since its March
20 peak, when a global dollar funding crunch saw a surge in demand.
    Against the safe-haven Japanese yen, the dollar was flat at 107.14.
    The euro was up 0.1% at $1.1581, just below a 21-month high of $1.1601 hit earlier on
Wednesday amid agreement on a European recovery fund.
    The Australian dollar retreated from a 15-month peak against the greenback to around
US$0.7105, down 0.5%, while the New Zealand dollar fell 0.4% to US$0.6637, just below Wednesday's
six-month top of US$0.6678.
    Elsewhere, China's offshore yuan partially recovered losses from an earlier slide against the U.S.
dollar, which was last down 0.1% at 7.009 yuan.
    U.S.-China ties have deteriorated this year over issues ranging from the new coronavirus and telecoms
gear maker Huawei, to China's territorial claims in the South China Sea and Hong Kong crackdown.
    The United States gave China until Friday to close its consulate in Houston following allegations of
spying.
    
    ========================================================
    Currency bid prices at 10:30AM (1430 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar      EUR=        $1.1589        $1.1568     +0.18%         +3.38%      +1.1597     +1.1541
 Dollar/Yen       JPY=        107.0900       107.1400    -0.05%         -1.63%      +107.2200   +107.0800
 Euro/Yen         EURJPY=     124.12         123.97      +0.12%         +1.78%      +124.2400   +123.7200
 Dollar/Swiss     CHF=        0.9261         0.9295      -0.37%         -4.31%      +0.9301     +0.9263
 Sterling/Dollar  GBP=        1.2721         1.2732      -0.09%         -4.06%      +1.2753     +1.2674
 Dollar/Canadian  CAD=        1.3403         1.3415      -0.09%         +3.21%      +1.3427     +1.3371
 Australian/Doll  AUD=        0.7118         0.7138      -0.28%         +1.38%      +0.7161     +0.7091
 ar                                                                                             
 Euro/Swiss       EURCHF=     1.0735         1.0753      -0.17%         -1.08%      +1.0762     +1.0716
 Euro/Sterling    EURGBP=     0.9107         0.9084      +0.25%         +7.72%      +0.9124     +0.9082
 NZ               NZD=        0.6640         0.6661      -0.32%         -1.43%      +0.6689     +0.6631
 Dollar/Dollar                                                                                  
 Dollar/Norway    NOK=        9.1649         9.1389      +0.28%         +4.40%      +9.2214     +9.1055
 Euro/Norway      EURNOK=     10.6227        10.5970     +0.24%         +7.98%      +10.6455    +10.5523
 Dollar/Sweden    SEK=        8.8574         8.8549      -0.02%         -5.24%      +8.9113     +8.8377
 Euro/Sweden      EURSEK=     10.2641        10.2657     -0.02%         -1.96%      +10.2880    +10.2420
 
    
 (Reporting by Gertrude Chavez-Dreyfuss; editing by Jonathan Oatis)
  
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