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FOREX-Dollar fights for footing as Fed minutes eyed

    * Cautious mood in Asia as Singapore, Taiwan face outbreaks
    * Risk currencies slip, but dollar still faces broad
pressure
    * Fed minutes in focus
    * Graphic: World FX rates tmsnrt.rs/2RBWI5E

    By Tom Westbrook
    SINGAPORE, May 17 (Reuters) - The U.S. dollar found pockets
of support in Asia on Monday, but struggled to post gains, as
investors are heavily positioned for it to fall further while
the U.S. Federal Reserve holds interest rates low and U.S. trade
and current account deficits grow.    
    Easing commodity prices and virus outbreaks in Singapore and
Taiwan - where COVID-19 had been contained - helped modest
dollar gains of 0.2% against the Australian and New Zealand
dollars in the early part of the Asia session.
    The greenback also rose 0.1% against the euro and
the yen. But it remains close to testing major support
levels, which if broken could see a return to a downtrend that
pressed it lower through April.
    A dollar bounce that followed higher-than-expected inflation
data last week has also faded as traders figure the Fed will
keep rates low. 
    The dollar last traded at $1.2134 per euro and has support
around $1.2179. The dollar index is likewise, at 90.389,
just above key support at 89.677 and 89.206. It bought 109.45
yen and traded at $0.7758 per Aussie and $0.7228 per kiwi
.
    Fed minutes, from an April meeting that predated the data
surprise on inflation last week, are due on Wednesday and are
the next market focus for clues on the Fed's thinking.
    "We expect the minutes ... to reiterate that policymakers
consider the pick up in inflation to be transitory," said Kim
Mundy, a currency strategist at the Commonwealth Bank of
Australia in Sydney.
    "The upshot is that we do not expect the (Fed) to consider
tapering its asset purchases soon," she said. "The dollar is
expected to resume its downtrend this week after last week's
CPI-inspired boost."    
    Speculators increased their bets against the dollar last
week, mostly by adding to bets on the euro and to a lesser
extent sterling as Britain and Europe head toward recovery.

    Sterling was perched near a two-and-a-half-month
high on Monday, at $1.4085, as Britain reopens its economy after
a four-month COVID lockdown.
    Things are travelling in the opposite direction in Asia
where some early leaders in taming the pandemic are now dealing
with new outbreaks. Singapore and Taiwan have both tightened
curbs as cases rise and the Taiwan dollar fell to a
three-week low on Monday.
    The dollar crept up 0.1% against the Chinese yuan to
trade at 6.4424 ahead of industrial output and retail sales
figures due mid morning on Monday.
    Elsewhere cryptocrrencies traded under pressure after
another weekend bouncing around following tweets from Tesla boss
Elon Musk. Bitcoin hit its lowest since February on Sunday after
Musk hinted at Tesla possibly selling its holdings.
    Bitcoin last traded 2% weaker at $45,302 and
ether was 4% lower at $3,421.
    
=======================================================
    Currency bid prices at 116 GMT
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
                                              Session                                           
 Euro/Dollar                  $1.2135        $1.2147     -0.10%         -0.68%      +1.2151     +1.2132
 Dollar/Yen                   109.4150       109.3350    +0.13%         +5.99%      +109.4950   +109.4800
 Euro/Yen         <EURJPY=EB  132.76         132.78      -0.02%         +4.60%      +132.9400   +132.7600
                  S>                                                                            
 Dollar/Swiss                 0.9021         0.9012      +0.11%         +1.97%      +0.9024     +0.9015
 Sterling/Dollar              1.4085         1.4098      -0.07%         +3.11%      +1.4104     +1.4086
 Dollar/Canadian              1.2124         1.2104      +0.16%         -4.80%      +1.2125     +1.2106
 Aussie/Dollar                0.7759         0.7781      -0.26%         +0.88%      +0.7787     +0.7759
 NZ                           0.7229         0.7250      -0.23%         +0.72%      +0.7249     +0.7229
 Dollar/Dollar All spots
Tokyo spots
Europe spots 
Volatilities 
Tokyo Forex market info from BOJ 

    
 (Reporting by Tom Westbrook. Editing by Gerry Doyle)
  
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