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FOREX-Dollar finds footing on U.S. economy as euro falters

    * Dollar inches higher in Asia; EUR and JPY near major lows
    * AUD, NZD begin to hand back small Friday gains
    * Graphic: World FX rates tmsnrt.rs/2RBWI5E

    By Tom Westbrook
    SINGAPORE, March 29 (Reuters) - The dollar began the week on
a firm footing, inching toward a milestone peak against the euro
on Monday, as a cautious market mood pushed investors to safety
while U.S. economic strength and a rapid vaccine rollout also
added to the greenback's shine.
    The euro was down 0.1% in the Asia session at
$1.1783, not far above last week's four-and-a-half-month trough
of $1.1762 and well below its 200-day moving average of about
$1.1866.
    The common currency is headed for its worst month since
mid-2019 as Europe's faltering vaccination programme runs into a
wave of new infections, a bearish signal as positioning data
shows investors remain heavily long euros.
    "The euro has continued to fall ... even as long-term U.S.
yields have lost some upward momentum," analysts at MUFG Bank
said in a note. "It suggests euro weakness was driven more by
concerns over the weakening outlook for growth in the eurozone
in light of rising COVID cases."
    Virus-driven caution also helped the dollar higher against
the Australian dollar, New Zealand dollar and sterling and it
rose against oil-liked currencies as the re-floating of the ship
blocking the Suez Canal pushed crude prices down by about 1.5%.
    Concern in equity markets at the widening fallout from a
wave of liquidations linked to investment fund Archegos Capital
also put investors in a careful mindset.
    Only the safe-haven Japanese yen made headway,
scraping from a 10-month low it made on Friday to inch about
0.2% higher to 109.43 -- though along with the Swiss franc it
remains at the bottom of the G10 leaderboard this year.        
    Over the quarter, the dollar has posted a 0.7% loss on the
pound, which has been supported by Britain's speedy vaccination
rollout, a 0.8% gain on the Australian dollar and a 2.9% gain
against the kiwi, which has been hit by housing market reforms.
    The yen, which is sensitive to gaps in returns on U.S. and
Japanese government debt has fallen about 5.7%, its worst
quarterly performance since late 2016, while the franc is down
5.8% for its worst performance since the third quarter of 2014.
    This year's 76-basis-point rise in benchmark 10-year
Treasury yields - as the U.S. economy rebounds - has been a
large driver, as the better returns offer carry for investors
who can borrow the yen and franc very cheaply.
    The Aussie was last down 0.3% at $0.7621 on Monday
and the New Zealand dollar had dropped 0.3% to $0.6978,
while sterling slipped 0.2% to $1.3767.    
    "The U.S. is also being helped on its own by some pretty
good economic data, fantastic rollout of vaccines, good pace of
vaccination and (positive) stock markets," said Westpac currency
analyst Imre Speizer.
    "The domestic economy is doing better than expected and
likely to be the case for the next few months, so that might
hold the U.S. dollar up and that's what's caused the Aussie,
kiwi and emerging-market currencies to pullback in March."
    U.S. jobless claims fell to a one-year low last week and
President Joe Biden said he would double his vaccination goal, 
after surpassing 100 million shots 42 days ahead of schedule.
    In contrast, European inoculations have been hit by supply
problems and safety concerns.
    Investors are looking ahead to Purchasing Managers Index
figures due midweek and for some details of Biden's
infrastructure spending plan. However the main data will be U.S.
hiring figures due on Good Friday.
    "The distribution of forecasts range from 460,000 to 1
million (jobs), where the whisper number sits at the top end of
the range," said Pepperstone's head of research, Chris Weston.
    "One million jobs would set the reflation trades alight ...
and cause a solid sell-off in bond yields taking USD/JPY and
USD/CHF higher," he said. "The euro should push through last
weeks lows of 1.1761 and towards 1.1690."
    
    ========================================================
    Currency bid prices at 0527 GMT
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar                  $1.1777        $1.1794     -0.14%         -3.61%      +1.1795     +1.1775
 Dollar/Yen                   109.4200       109.6650    -0.23%         +5.93%      +109.7950   +109.3950
 Euro/Yen                     128.86         129.33      -0.36%         +1.53%      +129.4200   +128.8500
 Dollar/Swiss                 0.9395         0.9393      +0.03%         +6.20%      +0.9402     +0.9395
 Sterling/Dollar              1.3768         1.3799      -0.23%         +0.77%      +1.3799     +1.3766
 Dollar/Canadian              1.2621         1.2571      +0.41%         -0.88%      +1.2627     +1.2578
 Aussie/Dollar                0.7623         0.7642      -0.25%         -0.90%      +0.7645     +0.7619
 NZ                           0.6979         0.7000      -0.29%         -2.81%      +0.6995     +0.6975
 Dollar/Dollar All spots
Tokyo spots
Europe spots 
Volatilities 
Tokyo Forex market info from BOJ

    
 (Reporting by Tom Westbrook; Editing by Sam Holmes)
  
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