- Dollar dips, Georgia elections in focus
- Yuan official rate fixed at highest level in 30 months
- Aussie dollar gains
- Graphic: World FX rates in 2021 https://tmsnrt.rs/2RBWI5E
(Adds details, updates prices; changes byline, previous LONDON)
The dollar fell against a basket of major currencies on Tuesday, in the wake of China's decision to lift its official yuan exchange rate by its highest margin since it abandoned a dollar peg in 2005, while U.S. Senate runoff elections in Georgia were also eyed.
China's central bank set the official yuan midpoint CNY=PBOC at 6.4760 per dollar before the market opened, up 1% from the previous fix, the biggest change higher since 2005.
In the offshore market, the yuan strengthened as far as 6.4119 CNH=EBS for the first time since mid-June 2018. It started the week at 6.494.
The dollar briefly strengthened in a risk-off move on Monday as U.S. stocks dropped, but resumed their downward trajectory in the wake of China's announcement, which also helped lift risk currencies. After initially opening lower, U.S. stocks turned higher to further dent the dollar's attractiveness, with the outlook of the Georgia runoffs in focus.
A Democratic victory in both races could take control of the Senate away from Republicans, paving the way for further stimulus measures as well as higher corporate taxes and more regulation.
"Based off of the track record of Republicans on Election Day, there is still that belief that they are going to at least be able to win one of these races; if that happens, we don’t have to worry about the massive fiscal support" expected from a Democratic-controlled Senate, said Edward Moya, senior market analyst at OANDA in New York.
"Because it has been so heavily in one direction, right now we are at some key support levels for the dollar index that we are probably going to see some choppy trade here."
The dollar index =USD fell 0.215% to 89.672. The New York Stock Exchange said it no longer intends to de-list three Chinese telecom companies. The surprising reversal of an announcement made only last week added to confusion over a U.S. crackdown on companies said to be linked to China's military.
The Aussie dollar AUD=D3 , a barometer of risk appetite that also tends to follow the yuan, was up 0.74% at 0.7722, approaching the 2-1/2-year high of .7743 touched on the final day of 2020.
The euro EUR= was up 0.19% at $1.2271 while the Japanese yen strengthened 0.32% versus the greenback at 102.80 per dollar.
Sterling GBP= was last trading at $1.3592, up 0.17%, having been buffeted by a surge in infections of a fast-spreading new coronavirus variant in the UK, with Prime Minister Boris Johnson ordering another nationwide lockdown.
It slid 0.73% on Monday, the most since Dec. 10, after earlier rising to $1.3703, a level not seen since May 2018.
Bitcoin traded at $32,045.29 BTC=BTSP following a roller-coaster ride that took it to a record high of $34,800 on Sunday, followed by a tumble to as low as $27,734 the following session.
======================================================== Currency bid prices at 10:46AM (1546 GMT)Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Dollar index =USD 89.6720 89.8780 -0.22% +0.00% +89.9170 +89.5890 Euro/Dollar EUR=EBS $1.2272 $1.2252 +0.15% +0.43% +$1.2291 +$1.2247 Dollar/Yen JPY=D3 102.7950 103.1750 -0.38% -0.49% +103.1850 +102.7800 Euro/Yen EURJPY= 126.14 126.33 -0.15% -0.61% +126.5500 +126.0600 Dollar/Swiss CHF=EBS 0.8796 0.8812 -0.16% -0.56% +0.8816 +0.8790 Sterling/Dollar GBP=D3 $1.3594 $1.3562 +0.24% -0.50% +$1.3611 +$1.3558 Dollar/Canadian CAD=D3 1.2738 1.2775 -0.28% +0.04% +1.2789 +1.2731 Aussie/Dollar AUD=D3 $0.7722 $0.7665 +0.74% +0.38% +$0.7725 +$0.7661 Euro/Swiss EURCHF= 1.0793 1.0795 -0.02% -0.13% +1.0819 +1.0791 Euro/Sterling EURGBP= 0.9027 0.9023 +0.04% +1.01% +0.9054 +0.9015 NZ NZD=D3 $0.7221 $0.7175 +0.67% +0.58% +$0.7227 +$0.7170 Dollar/DollarDollar/Norway NOK=D3 8.5180 8.5480 -0.09% -0.54% +8.5580 +8.5185 Euro/Norway EURNOK= 10.4549 10.4735 -0.18% -0.11% +10.4990 +10.4417 Dollar/Sweden SEK= 8.2054 8.2387 -0.37% +0.11% +8.2556 +8.1810 Euro/Sweden EURSEK= 10.0711 10.1084 -0.37% -0.05% +10.1130 +10.0392 <^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^ China sets yuan mid-point at strongest in 30 months https://tmsnrt.rs/3b41hSW^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^^>
