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FOREX-Dollar dips as risk appetite improves on strong earnings, stimulus hopes
Published at 05/08/2020 at 16:29

* U.S. dollar index near more than 2-year low

* U.S. private payrolls miss expectations in July

* Euro zone PMIs showcase growth

(New throughout, updates prices, market activity, data and comments; new byline)

By Caroline Valetkevitch

NEW YORK, Aug 5 (Reuters) - The U.S. dollar slipped against basket of currencies on Wednesday as investors' appetite for risk improved on strong corporate earnings and expectations of more stimulus measures for the pandemic-ravaged global economy.

U.S. and European investors piled into stocks on Wednesday as companies in both regions posted a batch of positive earnings reports.

The dollar, a safe-haven currency, typically weakens when investors grow more comfortable holding riskier assets.

On Wednesday, the U.S. Dollar Currency Index , which measures the greenback's strength against six major currencies, was 0.536% lower at 92.652, just shy of a more than two year low of 92.593 touched last week.

"Clearly we have seen risk appetite rebound on global markets and sort of a return of the theme of a U.S. underperformance relative to world counterparts," said Karl Schamotta, chief market strategist at Cambridge Global Payments in Toronto.

U.S. stocks also have grown cheaper for overseas investors as the dollar has been pressured in recent weeks by worries about the U.S. economic slide during the coronavirus pandemic. The dollar fell further on Wednesday after the ADP National Employment Report, which showed U.S. private payrolls growth slowed sharply in July, suggesting a loss of momentum in the labor market.

"This morning's weak ADP data suggests we may see further weakness when non-farm payrolls land on Friday," he said. "That is weighing on the dollar's prospects relative to the other majors."

Euro zone business activity returned to modest growth in July as many curbs imposed to stop the spread of the coronavirus were lifted, while official estimates showed retail sales volumes rebounded in June.

Investors also are watching negotiations between the White House and congressional Democrats trying to reach a deal on a relief package by the end of this week. Treasury Secretary Steven Mnuchin said progress had been made.

The Australian dollar , which tends to rise when risk sentiment improves, was last up 0.88% at $0.7223 against the U.S. dollar.


Currency bid prices at 11:09AM (1509 GMT)

Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid

Previous Change


Euro/Dollar EUR= $1.1889 $1.1800 +0.75% +0.00% +1.1900 +1.1794

Dollar/Yen JPY= 105.5100 105.7000 -0.18% -3.08% +105.8700 +105.3300

Euro/Yen EURJPY= 125.45 124.76 +0.55% +0.00% +125.4800 +124.6400

Dollar/Swiss CHF= 0.9057 0.9132 -0.82% +0.00% +0.9139 +0.9054

Sterling/Dollar GBP= 1.3145 1.3060 +0.65% -0.86% +1.3161 +1.3059

Dollar/Canadian CAD= 1.3245 1.3317 -0.54% +1.99% +1.3330 +1.3233

Australian/Doll AUD= 0.7223 0.7160 +0.88% +2.88% +0.7241 +0.7154


Euro/Swiss EURCHF= 1.0769 1.0777 -0.07% +0.00% +1.0793 +1.0763

Euro/Sterling EURGBP= 0.9043 0.9032 +0.12% +0.00% +0.9050 +0.9013

NZ NZD= 0.6664 0.6622 +0.63% +0.00% +0.6672 +0.6619


Dollar/Norway NOK= 8.9467 9.0957 -1.64% +1.92% +9.1056 +8.9464

Euro/Norway EURNOK= 10.6407 10.7361 -0.89% +0.00% +10.7467 +10.6339

Dollar/Sweden SEK= 8.6548 8.7179 +0.01% +0.00% +8.7264 +8.6497

Euro/Sweden EURSEK= 10.2927 10.2916 +0.01% +0.00% +10.3035 +10.2836

<^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ Euro near 2-year high Graphic: World FX rates in 2020


(Reporting by Caroline Valetkevitch; Additional reporting by Olga Cotaga and Saqib Iqbal Ahmed; editing by John Stonestreet and David Gregorio)

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