FOREX-Yen gains, Aussie slips as risk sentiment sours

* Graphic: World FX rates in 2019 http://tmsnrt.rs/2egbfVh (Updates prices) By Karen Brettell NEW YORK, May 1 (Reuters) - The safe haven Japanese yen gained on Friday and riskier currencies, including the Australian dollar, dropped as risk sentiment soured after U.S. President Donald threatened to impose new tariffs on China over the coronavirus crisis. said on Thursday his hard-fought trade deal with China was now of secondary importance to the coronavirus pandemic and he threatened new tariffs on Beijing, as his administration crafted retaliatory measures over the outbreak. “U.S. President soured the mood in equity markets, raising his accusations against China about the coronavirus outbreak, threatening new tariffs,” Action Economics said in a report. “The yen has outperformed while commodity currencies have underperformed amid a sharp phase of risk-off positioning.” The dollar fell 0.29% against the yen to 106.86 yen. The Australian dollar, which on Thursday reached a seven-week high of $0.6569, dropped 1.54% to $0.6410. The Chinese yuan also weakened in the offshore market to 7.1378 yuan, the most per dollar since April 2. "Given the scale of the COVID-19 impact, there is certainly a high risk of geopolitical tensions escalating considerably as lockdowns reverse," said Derek Halpenny, head of research at MUFG. "This would clearly be another hit to global trade that would add a layer of dollar support going forward," Halpenny said. The euro continued to gain against the greenback, having also rallied on Thursday on month-end repositioning. It was last up 0.17% at $1.0974, after earlier reaching $1.1017, the highest since April 1. Much of Europe and Asia was closed on Friday for International Workers' Day. The greenback gained 0.94% against the Canadian dollar , which also suffered from the risk-off move. Canada on Friday tapped Tiff Macklem, an experienced central banker who has been a leading voice in the country for the transition toward a green economy, as the Bank of Canada's 10th central bank governor. The dollar index against a basket of currencies fell 0.04% to 99.08. Deutsche Bank currency strategist George Saravelos said that if the United States imposes capital controls on China it would be dollar-negative, as that would imply outflows from greenback-denominated assets. "If the move is politically driven, it would be a clear dollar negative in our view. It would lead to a shift in reserve holdings out of the USD into EUR, JPY, GBP, gold and other reserve proxies," Saravelos said. ======================================================== Currency bid prices at 3:00PM (1900 GMT) Description RIC Last U.S. Close Pct Change YTD Pct High Bid Low Bid Previous Change Session Euro/Dollar EUR= $1.0974 $1.0955 +0.17% -2.11% +1.1017 +1.0935 Dollar/Yen JPY= 106.8600 107.1700 -0.29% -1.84% +107.4000 +106.6100 Euro/Yen EURJPY= 117.28 117.34 -0.05% -3.83% +117.7500 +117.0300 Dollar/Swiss CHF= 0.9617 0.9652 -0.36% -0.63% +0.9669 +0.9590 Sterling/Dollar GBP= 1.2483 1.2592 -0.87% -5.85% +1.2600 +1.2484 Dollar/Canadian CAD= 1.4072 1.3941 +0.94% +8.36% +1.4109 +1.3931 Australian/Doll AUD= 0.6410 0.6510 -1.54% -8.70% +0.6511 +0.6411 ar Euro/Swiss EURCHF= 1.0554 1.0574 -0.19% -2.75% +1.0583 +1.0552 Euro/Sterling EURGBP= 0.8790 0.8696 +1.08% +3.97% +0.8795 +0.8693 NZ NZD= 0.6047 0.6124 -1.26% -10.23% +0.6126 +0.6048 Dollar/Dollar Dollar/Norway NOK= 10.3511 10.2414 +1.07% +17.92% +10.3568 +10.2391 Euro/Norway EURNOK= 11.3620 11.2270 +1.20% +15.49% +11.3910 +11.2085 Dollar/Sweden SEK= 9.8566 9.7562 +1.27% +5.45% +9.8566 +9.7494 Euro/Sweden EURSEK= 10.8210 10.6848 +1.27% +3.36% +10.8240 +10.6872 (Reporting by Karen Brettell; Additional reporting by Olga Cotaga in London; editing by Jonathan Oatis and Chizu Nomiyama)

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