FOREX-Dollar Holds Low Bias On Expectations Powell Will Avoid Reduction


    * Graphic: World FX rates
    * Focus is on Fed meeting ending Wednesday
    * Treasury yields and dollar likely to fall on Fed stance
    * Euro bid on improving economic data
    * Turkish lira at risk of testing all-time low 

    By Stanley White
    TOKYO, April 26 (Reuters) - The dollar nursed losses against
most currencies on Monday amid speculation that U.S. Federal
Reserve Chairman Jerome Powell will shun talk of tapering bond
purchases at a policy meeting this week.
    The euro rose to a near two-month high against the greenback
before data later on Monday forecast to show an improvement in
German business sentiment, which would bolster hopes for a
brighter economic outlook. 
    Powell is likely to face questions over whether an improving
labour market and rising coronavirus vaccinations warrant a
withdrawal of monetary easing, but most analysts expect him to
say such talk is premature, which would put downward pressure on
Treasury yields and the dollar.  
    "The dollar is likely to continue to trend lower in line
with the gathering momentum in the world economy," analysts at
Commonwealth Bank of Australia wrote in a research note.
    "We expect the Fed policy meeting to be a non-event for the
dollar. The U.S. economy is a long way from meeting the
'substantial further progress' threshold for the Fed to taper
its asset purchases."
    The dollar stood at 107.88 yen, close to its lowest
since March 4.
    The euro rose to $1.2105, adding to gains made on
Friday after positive data on European services and
manufacturing activity.
    A survey from Germany's Ifo institute due later on Monday is
expected to show business conditions continued to improve in
Europe's largest economy. 
    The British pound was quoted at $1.3876 following a
0.3% gain in the previous session.
    The dollar was little changed at 0.9136 Swiss franc
, close to a two-month low.
    The Fed's next meeting ends on Wednesday, and while no major
policy changes are expected, investors will pay close attention
to Powell's comments after the meeting.
    Rising coronavirus vaccination rates and an improving
economic outlook are reasons to be optimistic, but many traders
and analysts say Powell is likely to reiterate his commitment to
keep easy policy in place for an extended period.
    U.S. funds have been selling the dollar against the yen
recently in Asian trading, which is an additional sign that
major investors expect lower U.S. Treasury yields to push the
dollar lower, some traders in Tokyo said.
    Speculators' net bearish bets on the dollar have risen to a
three-week high, according to calculations by Reuters and U.S.
Commodity Futures Trading Commission data, also pointing to
further declines for the greenback.
    In emerging markets, traders are watching the Turkish lira
 to see if it will test its all-time low of 8.58 per
dollar due to worsening relations with the United States and
worries about a dovish central bank governor. The lira was last
quoted at 8.4325.
    Elsewhere, the Australian and New Zealand dollars
 traded near one-month highs but are likely to track
moves in global commodity prices, traders said.
    In the cryptocurrency market, Bitcoin reclaimed
the $50,000 mark and smaller rival Ether rose,
recouping some of their losses from last week triggered by U.S.
President Joe Biden's plan to raise capital gains taxes for
wealthy investors.
    Currency bid prices at 0027 GMT
 Description      RIC         Last           U.S. Close  Pct Change     YTD Pct     High Bid    Low Bid
                                              Previous                   Change                 
 Euro/Dollar                  $1.2096        $1.2097     +0.00%         -0.99%      +1.2097     +1.2089
 Dollar/Yen                   107.8800       107.8800    +0.01%         +4.45%      +107.9350   +107.8600
 Dollar/Swiss                 0.9136         0.9137      -0.03%         +3.24%      +0.9140     +0.9134
 Sterling/Dollar              1.3876         1.3881      -0.05%         +1.55%      +1.3879     +1.3872
 Dollar/Canadian              1.2469         1.2475      -0.03%         -2.07%      +1.2490     +1.2471
 Aussie/Dollar                0.7752         0.7746      +0.08%         +0.77%      +0.7753     +0.7735
 NZ                           0.7197         0.7195      +0.03%         +0.22%      +0.7199     +0.7191
 Dollar/Dollar All spots
Tokyo spots
Europe spots 
Tokyo Forex market info from BOJ

 (Reporting by Stanley White; editing by Richard Pullin)


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