April 29, 2020 / 7:41 PM / a month ago

FOREX-Dollar drops as Fed repeats vow to support economy

 (Recasts with Fed meeting, adds quote, updates prices)
    * Graphic: World FX rates in 2019 tmsnrt.rs/2egbfVh

    By Karen Brettell
    NEW YORK, April 29 (Reuters) - The dollar fell on Wednesday
after the Federal Reserve left interest rates unchanged and
repeated a vow to do what it takes to shore up the economy that
has been battered by business shutdowns due to the novel
coronavirus.
    "The Federal Reserve is committed to using its full range of
tools to support the U.S. economy in this challenging time,
thereby promoting its maximum employment and price stability
goals," the central bank said in a statement at the end of a
two-day policy meeting.
    The dollar index against a basket of currencies fell
0.32% to 99.544, but held above a two-week low of 99.44 reached
on Tuesday.
    “They’re certainly not wanting to upset the apple cart. They
went out of their way to say they’re going to continue to do
what they’re doing,” said Marvin Loh, senior global macro
strategist at State Street Global Markets.
    The dollar has weakened more than 3% after scaling a more
than three-year peak of 102.99 in late March as global central
banks launched massive stimulus measures to protect economies
from the coronavirus pandemic.
    The Fed’s statement came after data earlier on Wednesday
showed that the U.S. economy contracted in the first quarter.
    The Commerce Department said gross domestic product fell at
a 4.8% annualized rate in the January-to-March period after
expanding at a 2.1% rate in the final three months of
2019.
    The dollar reaction to the data was not “huge,” but “I think
it’s going to pour cold water over hopes of a V-shape recovery.
And I think it also validates fears that second-quarter growth
could be in line with some of the more dire forecasts of a 40%
contraction,” said Joe Manimbo, senior market analyst at Western
Union Business Solutions in Washington.
    The greenback also weakened on improving risk sentiment
after Gilead Sciences said its experimental antiviral
drug remdesivir helped improve symptoms in COVID-19 patients who
were given the drug early.
    That added to optimism that businesses across the globe are
closer to reopening.
    “We’re seeing increasing chatter about economies opening up
around the world, so that would suggest that the global economic
reboots could happen sooner rather than later,” Manimbo said.
    The Australian dollar, which is seen as a proxy for
global growth, jumped 0.83% to $0.6544. It earlier reached
$0.6551, the highest since March 10.
    The euro gained 0.51% to $1.0873 before a European
Central Bank meeting on Thursday.
    

    ========================================================
    Currency bid prices at 3:21PM (1921 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar      EUR=        $1.0873        $1.0818     +0.51%         -3.01%      +1.0885     +1.0819
 Dollar/Yen       JPY=        106.6000       106.8600    -0.24%         -2.08%      +106.8900   +106.3700
 Euro/Yen         EURJPY=     115.94         115.62      +0.28%         -4.93%      +116.0700   +115.4600
 Dollar/Swiss     CHF=        0.9749         0.9750      -0.01%         +0.73%      +0.9767     +0.9714
 Sterling/Dollar  GBP=        1.2454         1.2421      +0.27%         -6.07%      +1.2485     +1.2390
 Dollar/Canadian  CAD=        1.3891         1.3993      -0.73%         +6.97%      +1.4003     +1.3885
 Australian/Doll  AUD=        0.6544         0.6490      +0.83%         -6.78%      +0.6551     +0.6487
 ar                                                                                             
 Euro/Swiss       EURCHF=     1.0601         1.0549      +0.49%         -2.31%      +1.0609     +1.0548
 Euro/Sterling    EURGBP=     0.8728         0.8705      +0.26%         +3.24%      +0.8755     +0.8695
 NZ               NZD=        0.6127         0.6054      +1.21%         -9.04%      +0.6133     +0.6052
 Dollar/Dollar                                                                                  
 Dollar/Norway    NOK=        10.3345        10.3962     -0.59%         +17.73%     +10.4387    +10.3268
 Euro/Norway      EURNOK=     11.2384        11.2548     -0.15%         +14.24%     +11.2983    +11.2220
 Dollar/Sweden    SEK=        9.8497         9.8838      +0.13%         +5.37%      +9.9007     +9.8404
 Euro/Sweden      EURSEK=     10.7117        10.6978     +0.13%         +2.32%      +10.7385    +10.6891
 
    
    
    
    

    
 (Additional reporting by Herb Lash; Editing by Jonathan Oatis)
  
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