Dollar slips anew

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    SINGAPORE- The dollar started the new year more or less where it left off – under pressure from investors who reckon low US interest rates and an eventual worldwide recovery from the coronavirus pandemic will make it a laggard against other major currencies.

    In Asia trade on Monday, still thinned by holidays, some short sellers were again adding to bets against the dollar and unwinding a small bounce it enjoyed on the last trading day of 2020 when profit-taking lent support.

    The euro rose 0.2 percent from its New Year’s Eve closing level to $1.2244, while a media report that Japan is considering a state of emergency for Tokyo pushed up the yen by about 0.3 percent to 103.05 per dollar.

    Japan’s Fuji TV reported an emergency may be declared for as early as this week, as the Japanese capital grapples with record levels of infection. Prime Minister Yoshihide Suga is due to hold a news conference to mark the start of 2021.

    That news also unwound what had been small early gains for the Australian and New Zealand dollars, which fell back to around steady, with the Aussie at $0.7681 and the kiwi at $0.7181.

    Surging coronavirus cases also held back gains in sterling, which was steady at $1.3669 after British Prime Minister Boris Johnson said on Sunday tougher lockdown restrictions were probably on the way as COVID-19.

    Still, the Chinese yuan, which has become a favored vehicle for shorting the dollar as China’s economy rebounds impressively, climbed roughly 0.2 to 6.4927 per dollar in offshore trade, close to testing a 2-1/2 year low.