FOREX-U.S. dollar skids from four-week high; euro gains

    * Euro rises after Bloomberg report on ECB forecasts
    * Sterling rises after EU says will not suspend Brexit talks
    * BoC keeps rates steady; Canadian dollar up
    * U.S. dollar to be well-supported until year-end -analyst
    * Graphic: World FX rates in 2020

 (Adds new comment, updates prices)
    By Gertrude Chavez-Dreyfuss
    NEW YORK, Sept 9 (Reuters) - The U.S. dollar slid from a four-week high on Wednesday, led by losses
against the euro after a news report said European Central Bank officials have become more confident in
their outlook for the region's recovery.
    The safe-haven greenback was also pressured by improving risk sentiment as U.S. stocks rebounded from
a sharp sell-off and as higher crude oil prices prompted gains in commodity currencies.
    Some analysts, however, expect the dollar to hold recent gains after a steep fall the last few months.
Since the beginning of September, the dollar has risen 2% against a currency basket.  
    Citing euro area officials, Bloomberg News reported on Wednesday that the ECB's upcoming projections
for output and inflation will show only slight changes to the June outlook, with gross domestic product
for this year to be revised higher.
    The report, which came ahead of Thursday's ECB monetary policy meeting, spurred euro buying.
    "It seems like there is still strong optimism about a euro zone recovery," said Edward Moya, senior
market analyst at OANDA in New York. "It's going to need more support, but things are not as bad as
initially believed."
    In afternoon trading, the euro rose 0.3% against the dollar to $1.1805, which pushed the
dollar index down 0.3% at 93.265. Earlier on Wednesday, the index advanced to a four-week peak of 93.664.
    That said, Scotiabank chief FX strategist Shaun Osborne believes the dollar will remain firmer
relative to the major currencies into the year-end, citing extreme bets against it in the speculative
    "We can see the dollar well-supported, primarily because positioning has been quite heavily skewed,
especially towards the euro," Osborne said.
    "I don't think with this pullback in the euro, we have seen anywhere near tidying up those significant
    He also said the dollar tends to rally ahead of a U.S. presidential election, at least since the
    Against other currencies, the dollar fell 0.5% to 0.9130 Swiss franc.
    The dollar rose 0.2% against the yen to 106.20 yen. Earlier, the safe-haven yen gained after
news of a delay in the roll-out of a COVID vaccine.
    AstraZeneca Plc said it paused global trials, including large late-stage trials, of its
experimental coronavirus vaccine due to an unexplained illness in a study participant.
    Sterling, meanwhile, briefly rose back above $1.30 after an EU statement said it would not suspend
Brexit negotiations over the British government's new internal market bill. The pound was last up 0.1% at
    The pound earlier fell to a six-week low, as new legislation on Britain's post-Brexit plans stoked
fears that trade talks with the European Union would derail.
    Commodity currencies, one of many barometers to gauge risk appetite, gained as crude prices rose and
stocks advanced.
    The Australian and New Zealand dollars rose against the greenback, both gaining 0.8% to US$0.7272
 and US$0.6669, respectively.
    The Canadian dollar recovered against the U.S.  currency, which fell 0.6% to C$1.3160, after
the Bank of Canada held interest rates steady at 0.25% on Wednesday.
    Currency bid prices at 3:01 PM (1901 GMT)
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
 Euro/Dollar      EUR=        $1.1807        $1.1779     +0.24%         +5.32%      +1.1833     +1.1754
 Dollar/Yen       JPY=        106.2000       106.0100    +0.18%         -2.43%      +106.2700   +105.8000
 Euro/Yen         EURJPY=     125.40         124.83      +0.46%         +2.83%      +125.6400   +124.4500
 Dollar/Swiss     CHF=        0.9123         0.9173      -0.55%         -5.73%      +0.9190     +0.9124
 Sterling/Dollar  GBP=        1.2990         1.2987      +0.02%         -2.03%      +1.3023     +1.2886
 Dollar/Canadian  CAD=        1.3153         1.3232      -0.60%         +1.29%      +1.3259     +1.3148
 Australian/Doll  AUD=        0.7274         0.7214      +0.83%         +3.62%      +0.7287     +0.7193
 Euro/Swiss       EURCHF=     1.0773         1.0804      -0.29%         -0.73%      +1.0817     +1.0775
 Euro/Sterling    EURGBP=     0.9087         0.9068      +0.21%         +7.49%      +0.9130     +0.9060
 NZ               NZD=        0.6670         0.6618      +0.79%         -0.98%      +0.6685     +0.6602
 Dollar/Norway    NOK=        9.0093         9.1243      -1.26%         +2.63%      +9.1840     +9.0099
 Euro/Norway      EURNOK=     10.6395        10.7498     -1.03%         +8.15%      +10.8001    +10.6376
 Dollar/Sweden    SEK=        8.7492         8.8312      -0.61%         -6.38%      +8.8554     +8.7506
 Euro/Sweden      EURSEK=     10.3328        10.3966     -0.61%         -1.30%      +10.4160    +10.3329
 (Reporting by Gertrude Chavez-Dreyfuss; Editing by Andrea Ricci and Dan Grebler)

Source: Read Full Article